Gross profit is the amount of money a business makes after deducting the costs of producing and selling its goods or the costs of offering its services.
A company's income statement will show gross profit, which is derived by deducting the cost of goods sold (COGS) from revenue (sales). The income statement of a business will contain these numbers. Sales profit or gross income are other names for gross profit.
As a general rule, fixed expenses are excluded from gross profit (that is, costs that must be paid regardless of the level of output). Rent, advertising, insurance, salary for those not directly involved in the production, and office supplies are some examples of fixed costs.
However, it should be emphasized that under absorption costing, which is necessary for external reporting in accordance with Generally Accepted Accounting Principles (GAAP), a portion of the fixed cost is assigned to each unit of production.
Extra reading:
https://www.investopedia.com/terms/g/grossprofit.asp
https://www.zoho.com/books/guides/what-is-the-difference-between-gross-and-net-profit.html
If you have any other questions please feel free to reach out to us using the contact us page.
Customer SupportThe MetaWealth™ platform is operated by MetaWealth™ International, which is not a registered broker-dealer or investment advisor. MetaWealth™ does not provide investment advice, endorsement or recommendations with respect to any properties listed on the platform. Nothing on the platform, website or application should be construed as an offer to sell, solicitation of an offer to buy or a recommendation in respect of a security. You are solely responsible for determining whether any investment, investment strategy or related transaction is appropriate for you based on your personal investment objectives, financial circumstances and risk tolerance. It’s important to remember that the value of any investment can go up or down. You should consult with licensed legal professionals and investment advisors for any legal, tax, insurance or investment advice before making an investment decision. A financial advisor can help you to understand your financial goals and risk tolerance, and provide guidance on the best investment opportunities for you. MetaWealth™ does not guarantee any investment performance, outcome or return of capital for any investment opportunity posted on this site. MetaWealth™ is under no obligation to maximise profits. Our primary commitment is to safeguard investor capital and strive to deliver on projected returns. By investing, participants agree to relinquish any claims to profits or returns beyond those expressly projected and realised, as stated herein. By accessing the platform including web site and application, any pages thereof, you agree to be bound by the Terms of Service and Privacy Policy.