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Distinctions Among Gross Profit, Operating Profit, and Net Profit

December 31, 2023

What are the differences between gross profit, operating profit, and net profit?

Gross profit represents revenue minus the cost of goods sold (COGS). Operating profit subtracts operating expenses from gross profit, excluding non-operational items like interest and taxes. Net profit is the final profitability metric, deducting all expenses, including interest, taxes, and non-operational costs, from total revenue, providing the overall profit after all expenses are considered.

Tags : Profit Metrics , Financial Analysis , Income Statements

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