Following is stanley black & decker’s income statement for 2016 (in millions): stanley black & decker, inc. income statement for the year ended december 31, 2016 ($ millions) sales $11,406.9 cost of goods sold 7,139.7 gross profit $ 4,267.2 selling, general and administrative expenses 2,602.0 other operating expenses 268.2 operating income 1,397.0 interest and other nonoperating expenses 171.3 income before income tax 1,225.7 income tax expense 261.2 net income $ 964.5 compute stanley black & decker’s gross profit margin.
The computation of the gross profit margin is shown below:
Gross profit margin is
= Gross profit ÷ Sale revenue × 100
= $4,267.2 ÷ $11,406.90 × 100
By dividing the gross profit by the sales revenue we can get the gross profit margin.
It is always expressed in a percentage form
All the other information which is given in the question is not relevant. Hence, ignored it
Gross profit Margin 37.41%
The gross profit margin is the quotient between the gross profit and the sales:
Gross profit Margin 0,374089 = 37.41%