Profit 2.0 Flashcards
1
Q
Gross profit
A
Revenue - Cost of sales
>Cost of sales = direct costs (e.g. retailer: cost of buying in stock to re-sell, manufacturer: production costs - raw materials, factory wages; supplier: direct labour)
2
Q
Operating profit
A
Gross profit - Operating expenses (Overheads)
>Overheads - indirect costs (selling, admin)
3
Q
Net profit (profit for the year)
A
Operating profit - Interest (and any exceptional costs)
>Net profit can be before or after tax
