Question

What is Revenue Profit?

Answer 1

1. Revenue profit is defined as the difference between revenue income and revenue expenses.
2. This is earned in the ordinary course of business. This occurs when goods or services are sold at a higher price than their actual cost.
3. Revenue profit comes from frequent company interactions. It is shown as gross profit and net profit in trading and profit and loss statements.
4. It can be used to distribute dividends to shareholders or create reserve funds for various purposes. It demonstrates the efficiency of the firm. Every firm aims to maximise sales and profit.