GROSS MARGIN DOLLARS (GMD) Clause Samples
The Gross Margin Dollars (GMD) clause defines how the gross profit from sales, calculated as the difference between net sales revenue and the cost of goods sold, is determined and allocated between parties. In practice, this clause specifies the method for calculating GMD, such as which costs are included or excluded, and may outline how GMD is reported or shared in joint ventures or distribution agreements. Its core function is to ensure transparency and consistency in profit calculations, thereby preventing disputes over financial entitlements and clarifying each party’s share of the gross margin.
GROSS MARGIN DOLLARS (GMD). The difference between the price En Pointe invoices its customers for products and/or services (before any applicable sales tax) and En Pointe’s COST OF GOODS SOLD. Example: If the customer invoice is for $1,000 (before tax) and the COST OF GOODS SOLD is $950, the GROSS MARGIN DOLLARS on the order total $50. Also referred to as “Final Commissionable GMD” in the commission statements that are issued monthly on the 23rd of each month.