Sales Ratio Calculator

Sales Ratio Calculator calculator can be used to calculate the profit ratio based on total sales and cost of goods sold.

Input Parameters

Calculation Results

Calculation Formula

Profit Ratio = (Total Sales - Cost of Goods Sold) / Total Sales

Where:
Total Sales: The total revenue generated from sales.
Cost of Goods Sold: The direct costs attributable to the production of the goods sold by a company.

Result

Profit Ratio: 0.00%

Sales Ratio Calculator Calculator Usage Guide

Learn how to use the Sales Ratio Calculator calculator and its working principles

How to Use the Sales Ratio Calculator

  1. Enter the total sales amount in the "Total Sales" field.
  2. Enter the cost of goods sold in the "Cost of Goods Sold" field.
  3. Click the "Calculate" button to compute the profit ratio.
  4. The result will be displayed in the "Profit Ratio" field.

Understanding the Profit Ratio

The profit ratio is a financial metric that indicates the percentage of total sales revenue that exceeds the cost of goods sold. It is a measure of the company's profitability on a per-unit basis. A higher profit ratio indicates better profitability.

For example, if the total sales are $100,000 and the cost of goods sold is $60,000, the profit ratio would be calculated as follows:

Profit Ratio = ($100,000 - $60,000) / $100,000 = 40%

This means that for every dollar of sales, the company makes a profit of 40 cents.