ENTREPRENEURSHIP

Detailed explanation-1: -Gross profit is the total revenue minus the expenses directly related to the production of goods for sale, called the cost of goods sold. Derived from gross profit, operating profit reflects the residual income that remains after accounting for all the costs of doing business.

Detailed explanation-2: -Expenses are the costs a business incurs from its core operations, while revenue is the money it earns from selling products and services before paying expenses. Once you pay expenses, you get net income or profit, which equals the total revenues minus the total expenses from a given accounting period.

Detailed explanation-3: -What does total revenue minus total expenses indicate? “The profit or loss made by the business.”

Detailed explanation-4: -A profit is the amount of money you earn from a certain product or service, which is determined by subtracting costs from sales and setting the profit margin. Analyzing how profitable your products and services are is an essential step for establishing sales strategies and piquing the interest of your customers.

Detailed explanation-5: -When making a business decision between several options, what are you determining you estimate the opportunity cost? The benefits missed when choosing one option over another.