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Loading ...Glossary of Terms
Gross Profit Margin
What remains from sales after a company pays out the cost of goods sold (which includes shipping costs of merchandise to the company). To obtain gross profit margin, divide gross profit by sales. Gross profit margin is expressed as a percentage.
For example, if a company receives $100,000 in sales and its cost of goods sold were $50,000, the gross profit margin would be equal to $100,000 minus $50,000, divided by $50,000, or 50%. Basically, 50% gross profit margin means that for every dollar generated in sales, the company has 50 cents left over to cover expenses and make a profit.
Recapitalization
Recapitalization is a method to make a company’s capital structure more stable; and to boost the company’s stock price. For example, by issuing bonds and buying stock, or selling stock to reduce debt.
