Profit And Loss Statement/Account

Question 1

What is the definition of net profit?

Answer 1

The actual profit after working expenses not included in the calculation of gross profit have been paid.

Question 2

What is the definition of gross profit?

Answer 2

Gross profit is the profit a company makes after deducting the costs associated with making and selling its products, or the costs associated with providing its services.

Question 3

What is the definition of cost of sales?

Answer 3

the direct costs attributable to the production of the goods sold by a company. This amount includes the cost of the materials used in creating the good along with the direct labour costs used to produce the good.

Question 4

What is the definition of expenses?

Answer 4

Any expenses incurred in the ordinary course of business. Business expenses are deductible and are always netted against business income.

Question 5

What is the formula for gross profit?

Answer 5

Gross profit = revenue - cost of goods sold.