### GIGAMIND

Folder:
108 Data Analysis
File:
108.60.10 Data Analysis - Accounting terms

# Accounting terms

### Sales vs. Revenue

`Sales <> Revenue`
- Sales is revenue generated from selling products or services to customers
- But it's not necessarily all of the Revenue of a company because Revenue can be generated in other ways, specifically:
- Non-operating revenue like income from the sale of assets, interest, royalties, etc

### Gross Sales vs. Net Sales

`Gross Sales <> Net Sales`
- Gross sales is the total amount of sales for a company
- Net sales subtracts things like returns

### Gross Profit

`Gross Profit = Net Sales - COGS`

### Gross Margin

`Gross Margin = Gross Profit / Net Sales`
`Gross Margin = (Net Sales - COGS) / Net Sales`

First calculate Gross Profit by subtracting COGS from Net Sales, then divide that number by Net Sales to get a number between 0 and 1. This percentage is the Gross Margin.

### Net Profit

Also known as
- Bottom line
- Net income
- Net earnings

A measure of profitability after all costs and taxes. This is the actual profit after deducting operating expenses that are excluded from gross profit.

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