Profit Flashcards
1
Q
Gross profit formula
A
Revenue - Cost of sales
2
Q
Gross profit explained
A
Profit once direct costs are met
3
Q
Operating profit
A
Gross profit - operating expenses
4
Q
Operating profit explained
A
Difference between
gross profit and overheads (indirect costs, e.g. selling, administrative)
5
Q
Net profit (profit for the year)
A
Operating profit - Interest (and exceptional costs)
6
Q
Net profit (profit for the year) explained
A
Difference between
interest paid by business (e.g. on loans) and interest received by business (e.g. on money in deposit accounts)
