Operating expense is a loss, but is used in calculating overall profit.
Sales Les: Cost of goods sold Gross Profit Less: Operating Expenses Operating Income
Positive Operating income will result if gross profit exceeds operating expenses
Gross profit and operating profits are two different values as gross profit only cater direct expenses to produce goods while operating profit is calculated after deducting indirect expenses and selling and administration overall called operational expenses to arrive at operating profitExample:Sales xxxxLess:Purchases xxxxGross Profit xxxxLess:Selling Expenses xxxxAdmin Expenses xxxxother expenses xxxxOperating Profit xxxxxIf there is no selling, admin or other expenses then gross profit and operating profit will be same.
business operating for a profit
The difference is, that gross profit includes deduction from manufacturing cost. Sales value - Rawmaterial - Freight = Fluctuating Profit - Manufacturing Cost - Procurement = Gross Profit - Operating Expenses = Operating Profit
Profit is calculated by subtracting operating costs from gross revenues.
Gross operating profit, or GOP, describes the current line 'Income After Undistributed Operating Expenses' under the Uniform System of Accounts for the Lodging.
nett
Gross Profit is the difference between money received from sales and the money you have paid out for the goods you sold. Operating Profit is the gross profit less any expenses you incurred while trading such as rent for premises, electricity, telephone bills Net profit is the operating profit less any tax and interest and dividend paid. The net profit is sometimes called "bottom line profit" Hope this clears things up!
gross profit
Operating Profit = Sales - COGS - SG&A - Other operating ExpensesA loss incurred as a result of a fire would be classified as an Unusual or Infrequent Loss. This would effect NI, but since it is temporary (not part of a company's operations) it would be excluded from operating income/profit.