Definition and Classifications of The Profit (in Accounting)
When a company has a surplus of revenues over expenditures, the difference between them constitutes a profit (a loss constitutes an excess of expenditures over revenues). Various types of profit )gross profit, operating profit, pre-tax profit) appear in a company’s profit and loss statement. Each of these types reflects the difference between total revenues and some of the company’s expenditures. The difference between total revenues and all the company’s expenditures is its net profit, which appears in the bottom line of the profit and loss statement.
