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Richard
Richard, Tax Attorney
Category: Finance
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Experience:  29 years of experience as a tax, real estate, and business attorney.
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If an oil company had gross profit margins of 80% what would

Customer Question

If an oil company had gross profit margins of 80% what would the price of gas per gallon be? Same for other commodities? ie. If a beef company had 80% gross margins how much would a pound of ground beef be?
Gross profit margin is the difference between sales and the cost of goods sold divided by revenue.
Is there a basic formula to figure something like this out?
Submitted: 1 year ago.
Category: Finance
Expert:  Richard replied 1 year ago.
Hi Dave. My name is ***** ***** I look forward to helping you. Yes, there is a basic formula. The formula would be: (Cost to the Company) divided by 20%. Thus, if the company's cost was $10, $10 divided by 20% would be $50. Thus the profit is $40 which is 80% of the sales price.
Expert:  Richard replied 1 year ago.
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