Profit may be divided into: 


·        NET PROFIT

Let’s study in details:-

Operating Profit is the profit earned through normal operating activities of the business. It is calculated by deducting the Operating Expenses from the Gross Profit.

Operating Profit = Gross Profit - Operating Expense


 Net Profit is the profit earned through operating and non - operating activities of the business. 

Operating Expenses are the expenses incurred by an enterprise that are associated (incurred) with its operating activities. For example, a retail stores main or operating activity is buying and selling of goods. Therefore, cost of goods sold besides salaries paid to staff in Purchase Department, salaries paid to sales staff or accountants, electricity bill of ( whether operating or non- operating ) the store, etc., are operating expenses because without incurring these expenses, the enterprise cannot carry out its operating activities. Operating expenses include salaries, electricity expenses, selling and distribution expenses, cash discount allowed, depreciation and amortization, rent, repairs and bad debts, etc.

Non- operating Expenses are the expenses which do not relate to the main activity of the enterprise such as interest on loan, charity donation, loss on sale of fixed assets and loss by fire or theft or damage, etc.  Expenses, Operating and Non- operating, are debited to profit and loss account. 


Join COC Education, We provided best video classes for CA/CMA/CS/Class 11th & 12th/ B.com/M.com

Contact us on- 9999631597, 8448322142, 7303445575

Visit YouTube Channel CA/CMA Santosh Kumar

Click Now for Demo Video www.coceducation.com/free-lectures

Join WhatsApp group for your domain course www.coceducation.com




Latest Blogs

Who is The Best Faculty For Accounts?

You need the Best Faculty For Accounts, CA Exam Preparation, so that you can pass your exam with Flying Colors without wasting a single minute of your Precious Time. A Good Faculty will not only help you clear your exam but also help you achieve the highest rank Possible, which proves to be surely a great advantage in Job Placement after completing CA.

Best Video Lectures for Operations Management & Strategic Management (OMSM) CMA Inter Group-2

OMSM Operations Management and Strategic Management. Get your Video Lectures Operations Management and Strategic Management from COC Education

Top Reviews

Introduction to Statistics for CA Foundation

Introduction to Statistics for CA Foundation Business Mathematics, Logical Reasoning and Statistics is designed as per latest CA Foundation syllabus for Paper 3 to provide a firm grounding in the principles, techniques and practice. The book adopts self-study approach and has been written in student-friendly manner. With a blend of conceptual learning and problem-solving approach, it offers in-depth understanding of the basic mathematical and statistical tools. #introductiontostatistics

Chapter X of Companies Act 2013

Chapter X of Companies Act 2013 The company shall place the matter relating to such appointment for ratification by members at every annual general meeting. ... Under the Act, the provisions for rotation of auditors in the listed Company & certain other class of Companies, have been provided for. #chapterxofcompaniesact2013

Relevant sections under the Companies Act, 2013 dealing with fraud and false statements

Relevant sections under the Companies Act, 2013 dealing with fraud and false statements The new parent corporate law “The Companies Act 2013” is mostly ... I am limiting my write-up to the provisions to the Act, and I request the readers to refer relevant rules, if any, before ... in the 2013 Act is the Section 447 dealing with “Punishment for fraud”. ... Section 448

What is Corporate Image

What is Corporate Image A corporate identity or corporate image is the manner in which a corporation, firm or business enterprise presents itself to the public. The corporate identity is typically visualized by branding and with the use of trademarks, but it can also include things like product design, advertising, public relations etc #WhatisCorporateImage

What is Energy Audit

What is Energy Audit An energy audit is an inspection survey and an analysis of energy flows for energy conservation in a building. It may include a process or system to reduce the amount of energy input into the system without negatively affecting the output. #whatisenergyaudit