Gross Profit Vs Income From Operations

Net profit is the residual income left with the company after all deductions.

Gross profit vs income from operations. Gross profit labeled as gross income was 3 million for the quarter or revenue of 5 million minus 2 million in cogs. Operating profit can also be calculated as net profit minus non operating expense minus non operating income and it can be expressed as. Penney for the year ending in 2017 as reported in its 10k annual statement. The net sales are its top line.

Operating income gross profit results from subtracting a company s cost of goods from its gross revenue. Operating profit is gross profit minus operating expenses and can be written as operating profit gross profit operating expenses. As such operating income is a more accurate representation of a company s profitability than gross income. Operating profit was 2 2 million for the period which is calculated by.

Gross profit 4 3 billion. Operating profit is the income of the company left after paying off operating expenses. To illustrate the difference between operating income and gross profit we ll analyze the income statement from j c. Revenue or total net sales 12 5 billion.

These include compensation related expenses sales and marketing costs and miscellaneous office expenses like utilities and office supplies. Although operating income doesn t exactly represent a company s bottom line it comes pretty close to it. Below gross profit on an income statement you ll find the firm s operating expenses.