In business, Profit to Sales Ratio is the ratio of net profit divided by net sales for the period, usually expressed as a percentage.

- Profit To Sales Ratio:
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- What does Profit to Sales Ratio mean?
- It is the ratio between the net profit and the total sales.

- Formula
- Profit to Sales Ratio = Net Profit / Net Sales × 100

- Example
For example, a firm reports net profits of $50,000 and net sales are reported as $1,000,000 for the same period. According to the formula, Profit to Sales Ratio is:-

- = $50,000 ÷ $1,000,000 * 100
- = 5% Profit to Sales Ratio

###### History

- Aug 6, 2018
- Tool Launched

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