How To Calculate Gross Profit?


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Anonymous answered
Total up all money taken in over a given time period (be it a week, month, or year, or any other).  Before debiting expenses (also known as overhead) from this total, you will have a gross figure.

Once all expenses are subtracted from the gross, you will have the net profit calculated.

Suppose a retail business takes in $20,000 in one month.  This is the gross.
But, this business likely has expenses relating to payroll, taxes, insurance, equipment payments, and utilities.  Suppose these expenses total $15,000.  The net profit is then only $5,000, once we've subtracted $15,000 from $20,000.
Anonymous Profile
Anonymous answered
Simply by summing up the above answer we can calculate Gross Profit as:
  formula:   Sales-Cost of Goods sold=Gross Profit
deduct  the cost of goods sold from sales, then the remaining is Gross Profit.

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