Does the profit rate mentioned by general enterprises refer to the cost profit rate or the sales profit rate? Which refers to the gross profit margin? Gross profit or net profit?

Generally speaking, profit refers to sales profit, because enterprises invest costs to create wealth, and wealth comes from sales profit. Gross profit refers to the difference between sales revenue and sales cost, that is, operating profit or main business profit. Net profit (income) refers to the profit retained by the company after paying income tax according to regulations, which is also generally called after-tax profit or net income.

Generally speaking, gross profit is greater than net profit.

If it is to examine the profitability of enterprises, use the sales profit rate.

Sales profit rate = product sales profit/product sales income × 100%

If it is to examine the cost of an enterprise, use the cost profit rate.

Cost profit rate = total profit/total cost × 100%

Extended data:

Profit rate refers to the conversion of surplus value into profit and the conversion of surplus value rate into profit rate. Profit margin is the ratio of surplus value to all prepaid capital. Profit rate and surplus value rate are different ratios obtained by comparing the same surplus value with different amounts of capital.

The profit rate indicates the appreciation degree of all prepaid capital, which is always less than the surplus value rate in quantity, thus covering up the exploitation degree of capitalism. The profit rate is constantly changing, and the main factors that determine and affect the profit rate are:

First, the rate of surplus value. Other things being equal, the higher the surplus value rate, the higher the profit rate; On the contrary, the surplus value rate is low and the profit rate is low. Therefore, any method that can improve the surplus value rate will increase the profit rate accordingly.

Second, the organic composition of capital. The organic composition of capital is high and the profit rate is low; The organic composition of capital is low and the profit rate is high.

Third, the speed of capital turnover. The capital turnover speed is accelerated, and the annual surplus value rate is improved, thus improving the annual profit rate. The annual profit rate of capital changes in the same direction as the capital turnover rate.

Fourth, the conservation of constant capital. In the case of a certain surplus value rate and surplus value, saving constant capital can reduce prepaid capital, thus improving profit rate.

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