gross-to-net-position

margin?profit10080?grossprofit?20?netprofit10Grossprofitmargin?=20/100=20%?Netprofitmargin?=10/100=10%MarginisusedtocompareArelativetoB,whereAispartofB.Marginisusuallystatedasapercentage.Followingsaretwoexamplesofmargins:1.Grossprofitmargin=Grossprofit/revenue;2.Netprofitmargin=Earningaftertax/revenue;Inaccounting,asimpleexpressionofaprofitandlossstatementisasfollows:Revenue1,000Costofgoodsold-900GrossPROFIT100Operatingexpenses-10otherexpenses-2tax-3netPROFITaftertax85then,GrossprofitMARGIN=100/1000=10%.NetprofitMARGIN=85/1000=8.5%--------------PROFITisacertainamountofbenefitobtainedfromoperationsofacompanyorfromtradingactivities.Differentfromamargin,profitisstatedinafullmonetaryvalue.Intheaboveexample,thegrossprofitMARGINis10%buttheGrossPROFITis100;andnetprofitMARGINis8.5%buttheNetPROFITaftertaxis85.