Business – 10.1 Financial statements – Statement of profit or loss | e-Consult
10.1 Financial statements – Statement of profit or loss (1 questions)
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- Revenue (Sales): The total amount earned from the sale of goods or services before any deductions.
- Cost of Sales (Cost of Goods Sold): Direct costs attributable to the production of the goods sold or services provided.
- Gross Profit: Revenue minus Cost of Sales; shows the profit generated from core trading activities before overheads.
- Operating Expenses: Indirect costs such as selling, administrative and distribution expenses.
- Profit from Operations (Operating Profit): Gross Profit less Operating Expenses; indicates profitability from normal business operations.
- Taxation: Income tax payable on the profit before tax.
- Profit for the Year (Net Profit): Operating Profit minus Taxation; the final profit after all charges.
- Dividends: Portion of profit distributed to shareholders.
- Retained Earnings: Profit for the Year less Dividends; accumulated earnings retained in the business for reinvestment.