Gross profit or sales profit or gross operating profit is the difference between revenue and the cost of making a product or providing a service, before deducting overheads, payroll, taxation, and interest payments. Revenue is a U.S. business term for the amount of money that a company earns from its activities in a given period, mostly from sales of products and/or services to customers. ... In computer science, and moreso in computer programming, overhead is generally considered any combination of excess or indirect computation time, memory, bandwidth, or other resources that are required to be utilized or expended to enable a particular goal. ... Please wikify (format) this article or section as suggested in the Guide to layout and the Manual of Style. ... In finance, interest has three general definitions. ...

In general, it is the profit shown on a transaction if one disregards the indirect costs. It is the revenue that remains once one deducts the costs that arise only from the generation of that revenue. To meet Wikipedias quality standards, this article or section may require cleanup. ... A transaction is an agreement, communication, or movement carried out between separate entities or objects. ... Fixed costs or indirect costs are expenses that do not change in direct proportion to the activity of a business. ...

For a retailer, gross profit is the shop takings less the cost of the goods sold. For a manufacturer, the direct costs are the costs of the materials and other consumables used to make the product. For example, the cost of electricity to operate a machine is often a direct cost while the cost of lighting the machine room is an overhead. Payroll costs may also be direct if the workforce is paid a unit cost per manufactured item. For this reason, service industries that sell their services by time units often treat the fee-earners' time cost as a direct cost. Drawing of a self-service store. ... To meet Wikipedias quality standards, this article or section may require cleanup. ... Materials are inputs to production or manufacturing. ... Variable costs are expenses that change in direct proportion to the activity of a business. ... The workforce is the labour pool in employment. ... The tertiary sector of industry, also called the service sector or the service industry, is one of the three main industrial categories of a developed economy, the others being the secondary industry (manufacturing and primary goods production such as agriculture), and primary industry (extraction such as mining and fishing). ...

Gross profit is an important guide to profitability but many small businesses fail because they overlook the regular demand to meet the fixed costs of the business. The indirect costs are considered when calculating net income, another important guide to profitability. Profit is what is gained, after costs are accounted for. ... A small business may be defined as a business with a small number of employees. ... Fixed costs are gay! There i said it, happymnmbbn,b ... Net income is equal to the income that a firm has after subtracting costs and expenses from the total revenue. ...

See also

• Gross margin, the ratio of gross profit to revenue.