Question

Gross Margin is Sales Revenue less the Cost of Goods Sold.

Product Contribution is a measure of how profitable each of your products was last year by taking your Sales Revenue, Less Cost of Goods Sold to find the product's Gross Margin. Which report would you view to see the Gross Margins (how profitable) each of your products were last year?
A. Product Summary
B. Manufacturing & Debt
C. Forecast Results Reports

Answer 1

To see the Gross Margin of each product, you should view the Product Summary report, which details Sales Revenue and Cost of Goods Sold. The correct answer is option A.

Step-by-step explanation:

To determine the Gross Margins for each of your products from the previous year, you would look for a report that shows both Sales Revenue and Cost of Goods Sold (COGS) for each product. The report that typically includes this information is the Product Summary report. In accounting, the Gross Margin is calculated by subtracting the Cost of Goods Sold from the Sales Revenue. The Gross Margin reveals the profitability of a product before other expenses are taken into account. To consider the accounting profit, which includes total revenues minus explicit costs like depreciation, and the average profit or profit margin, dividing the profit by the quantity of output produced is necessary.