Question

Barehugs is popular loungewear that prides itself on its versatility. last year, its net sales were $1,750,000 with cost of goods of $390,000. taxes totaled $61,650. the company's expenses totaled $960,000. calculate the company's net after tax profit margin percentage

Answer 1

First, we need to find the gross margin.
Gross margin = net sales - cost of goods sold 
Gross margin = $1,750,000 = $390,000 
Gross margin = $1,360,000

Then, we need to find the net profit before tax.
Net profit before tax = gross margin - expenses
Net profit before tax = $1,360,000 = $960,000
Net profit before tax = $400,000

Net income after taxes = (total revenue - total expenses)/total revenue
Net income after taxes = (1,750,000 - 960,000)/(1,750,000)
Net income after taxes % = 45%