The gross profit is 390,000
Given: Sales= 1,340,000
cost= 950,000
calculating:
Gross profit = sales - cost
=1,340,000 - 950,000
=390,000
What is the gross profit meaning?
Gross profit is the profit a business makes after subtracting all the costs that are related to manufacturing and selling its products or services.
Why do we calculate gross profit?
Gross profit provides insight into how efficient a company is at managing its production costs, such as labor and supplies, to produce income from the sale of its goods and services. The gross profit for a company is calculated by subtracting the cost of goods sold for the accounting period from its total revenue.
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