By Leanna Kelly Companies need to generate profit to stay afloat. They do this by producing goods or services and selling them for more than it costs to produce them. This difference is the company’s gross profit: revenue minus the cost of producing goods or the services sold. If the number is positive, it means the company is selling efficiently; if it’s negative, it means the company is losing money.
Gross profit is a powerful indicator of a company’s production efficiency. How well is the company using labor and supplies to produce saleable goods at a profit? This is something investors will look …read more
