Gross Profit VS Net Profit
10 Mar 2026 · 0 min
0:18
In this brief instructional video, the speaker uses a straightforward example of buying a can of Coke for $1 and selling it for $3 to illustrate the concept of gross profit, which is the $2 difference between selling price and direct cost. The speaker then explains that net profit is calculated by subtracting all additional operating expenses—such as employee wages, rent, and electricity—from the gross profit, leaving the amount that truly remains after all costs are accounted for. The purpose is to clarify the fundamental distinction between gross profit (revenue minus cost of goods sold) and net profit (gross profit minus all other operating expenses).
