item cost - the amount paid by the retailer to the manufacturer or supplier for an item., retail price - the amount the customer pays the retailer for a product.​, markup - the amount added to the cost of a product to cover expenses and provide a profit.​, revenue - the combined income generated from the sale of goods and services, gross profit - the amount earned when calculating the difference between revenue and the cost of buying or producing the items sold.​, operating expenses - sometimes referred to as overhead, are the expenses retailers have during normal business operations, such as rent and staff salaries​, net profit - the difference between revenue and expenses, including all the the expenses of buying and/or producing the product (the COGS) and operating the company (operating expenses), profit margin or retail margin - the difference between the price an item is sold for and the price the retailer paid for the item, profit margin percentage - the percentage by which profits from sales exceed the revenues, cost of goods sold (COGS) - the direct costs associated with production of a product, including the raw materials used to make it and the labor costs.​,

3.4 Understanding Profit

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