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Net Profit Margin Formula

GoBusiness Net Profit Margin Formula

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Net Profit Margin is often referred to as the bottom line, this ratio takes all expenses into account including interest. Check FAQs

NPM = \frac{NI}{S} \cdot 100

NPM - Net Profit Margin?NI - Net Income?S - Sales?

Net Profit Margin Example

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Here is how the Net Profit Margin equation looks like with Values.

Here is how the Net Profit Margin equation looks like with Units.

Here is how the Net Profit Margin equation looks like.

20 = \frac{200000}{1E+6} \cdot 100

20 = \frac{200000}{1E+6} \cdot 100

20 = \frac{200000}{1E+6} \cdot 100

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Net Profit Margin Solution

Follow our step by step solution on how to calculate Net Profit Margin?

FIRST Step Consider the formula

NPM = \frac{NI}{S} \cdot 100

Next Step Substitute values of Variables

∴

NPM = \frac{200000}{1E+6} \cdot 100

Next Step Prepare to Evaluate

∴

NPM = \frac{200000}{1E+6} \cdot 100

LAST Step Evaluate

∴

NPM = 20

Net Profit Margin Formula Elements

Variables

Net Profit Margin

Net Profit Margin is often referred to as the bottom line, this ratio takes all expenses into account including interest.

Symbol: NPM

Measurement: NAUnit: Unitless

Note: Value should be greater than 0.

Formulas to find Net Profit Margin

Net Income

Net income is a company's total earnings.

Symbol: NI

Measurement: NAUnit: Unitless

Note: Value should be greater than 0.

Formulas to find Net Income

Sales

Sales is the total sales for the period.

Symbol: S

Measurement: NAUnit: Unitless

Note: Value should be greater than 0.

Formulas to find Sales

Other Formulas to find Net Profit Margin

Go Business Net Profit Margin

NPM = \frac{NI}{S} \cdot 100

Other formulas in Profitability Ratio category

Go Business Operating Profit Margin

OPM = \frac{OI}{S} \cdot 100

Go Pre Tax Margin Ratio

PTI = (\frac{EBT}{S}) \cdot 100

Go Return on Assets Ratio

ROA = \frac{NI}{TA}

Go EBIT Return on Assets

ROA = \frac{EBIT}{ATA}

How to Evaluate Net Profit Margin?

Net Profit Margin evaluator uses Net Profit Margin = Net Income/Sales*100 to evaluate the Net Profit Margin, Net Profit Margin is often referred to as the bottom line, this ratio takes all expenses into account including interest. Net Profit Margin is denoted by NPM symbol.

How to evaluate Net Profit Margin using this online evaluator? To use this online evaluator for Net Profit Margin, enter Net Income (NI) & Sales (S) and hit the calculate button.

FAQs on Net Profit Margin

What is the formula to find Net Profit Margin?

The formula of Net Profit Margin is expressed as Net Profit Margin = Net Income/Sales*100. Here is an example- 20 = 200000/1000000*100.

How to calculate Net Profit Margin?

With Net Income (NI) & Sales (S) we can find Net Profit Margin using the formula - Net Profit Margin = Net Income/Sales*100.

What are the other ways to Calculate Net Profit Margin?

Here are the different ways to Calculate Net Profit Margin-

Net Profit Margin=Net Income/Sales*100

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: Unit

Net Profit Margin Formula

​GoBusiness Net Profit Margin Formula

Net Profit Margin Example

Net Profit Margin Solution

Net Profit Margin Formula Elements

Other Formulas to find Net Profit Margin

Other formulas in Profitability Ratio category

How to Evaluate Net Profit Margin?

FAQs on Net Profit Margin

Variable Name

GoBusiness Net Profit Margin Formula