Академический Документы
Профессиональный Документы
Культура Документы
Step 2 Enter
Step 3 Enter
Discount %
The remaining $194.4 thousand in gross profit must be enough to cover company overhead, debt service, rewards for ownership and still retain a few dollars for the business. Gross profit is the first profit measure for many companies.
Given the above example, the "rate" of gross profit equals 51.9%. Now, if prices were lowered by a 40% discount to "stimulate" sales, the same volume of business would return fewer gross profit dollars because the "rate" of gross profit falls to 19.9%. Note: cost of goods sold remain unchanged. The question becomes, how much more business do you need at the lower gross profit rate to keep the $194,400 level of gross profit ? Step 1. Enter product costs of $180,000. Step 2. Enter mark-up at 108.
Discount Price New Gross Profit New Gross Profit Rate Required Increase in Sales $
Increase in Sales %
Gross Profit $ at the New Rate
#######
#VALUE!
The program calculates net sales and gross profit. Notice the gross profit rate is 51.9%
Step 3. Enter a discount of 40%.
The program calculates the increase in sales (161.3%) required to hold gross profit dollars at $194.4 thousand with the lower gross profit rate.
#DIV/0!
#DIV/0!
#DIV/0!