Is total revenue the same as gross profit?
Asked 2 years ago
I recently started an online store through Shopify and have run into a bit of confusion. I always thought that total revenue was different to gross profit, but now I've heard the term "net income" come up a few times and I'm not really sure what is what. Can anyone give me a basic explanation of total revenue, gross profit, and net income.
Saturday, October 02, 2021
Total revenue is the untouched amount of money you earn after selling your goods and service without excluding any expenditures. In contrast, gross profit is the amount of money you earn minus the product and marketing costs. At the very end, net income is the gross profit minus the tax and debt payments and every other expense.
Understanding these three terms is crucial for the successful financial forecasting and budgeting of your business.
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