To calculate gross profit margin, you need to divide a company's gross profit by its total revenue and multiply the result by 100 to express it as a percentage.
Here is the formula for calculating gross profit margin:
Gross profit margin = (Gross profit / Total revenue) x 100.
For example, if a company has total revenue of $100,000 and gross profit of $30,000, its gross profit margin would be calculated as follows:
Gross profit margin = ($30,000 / $100,000) x 100 = 30%
This means that for every $1 of revenue, the company is able to keep 30 cents as profit after accounting for the cost of producing and selling its products or services.
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