Profit rate = profit/selling price.

Other corresponding formulas are as follows:

Selling price = purchase price+profit or = profit/profit rate.

Purchase price = selling price-profit.

Profit rate is the ratio of surplus value to all prepaid capital, and profit rate is the transformation form of surplus value rate, which is another ratio calculated by different methods for the same surplus value. If P' stands for profit rate and c stands for all prepaid capital (c+v), then profit rate P'= M/C = M/(C+V).

Profit rate is a relative index reflecting the profit level of an enterprise in a certain period. Profit rate index can not only assess the completion of enterprise profit plan, but also compare the management level between enterprises and in different periods to improve economic benefits. Cost profit rate = profit/cost × 100%, and sales profit rate = profit/sales × 100%.

If W stands for commodity value, K stands for cost and P stands for profit, then the composition of commodity value under capitalist conditions, that is, W=c+v+m=k+m, further becomes W=k+p, that is, commodity value is converted into cost price+profit.

(1) The profit structure of an enterprise should match the asset structure of the enterprise.

(2) The cost changes are reasonable, and there is no unreasonable reduction in annual expenses.

(3) Whether the composition of each part of the total profit is reasonable.