Purchases Rs:20 lacs
Sales Rs:21 lacs
Closing stock Rs:1 lacs
Gross profit Rs:2 lacs
How to calculate procedure GP percentage
I believe you are referring Gross Profit ration (GP ratio).
GP ratio is derived by dividing gross profit by sales. Gross profit is direct sales minus direct expenses.
In your question Gross Profit is Rs. 2 lakhs and sales is 21 lakhs so GP ratio will be (Gross Profit/Sales * 100 )
2/21*100 = 9.52%
So GP ratio is 9.52%
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