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Net profit. Net profit, also referred to as the bottom line, net income, or net earnings is a measure of the profitability of a venture after accounting for all costs. It is the actual profit without inclusion of working expense in the calculation of gross profit.
The Meaning of the Net Profit Margin Ratio. When you look at the net profit margin ratio, you see that the numerator (net income) is affected by the company's actions to reduce expenses and the denominator (net sales) is affected by the company's actions to increase sales revenue. Net profit margin indicates how well the company converts its sales into profits.