Question

Gross profit is:

A.

Cost of goods sold + Opening stock

B.

Excess of sales over cost of goods sold

C.

Sales fewer Purchases

D.

Net profit fewer expenses of the period

Correct option is B

Gross profit is calculated as the excess of sales revenue over the cost of goods sold (COGS). It represents the profitability of a company before accounting for operating expenses, taxes, and other indirect costs.

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