Chapter 4 Vocab

the combined income generated from the sale of goods and services

• revenue

• cost of goods sold

• gross profit

• operating expenses

refers to the direct costs associated with production of a product, including the raw materials used to make it and any labor costs.

• revenue

• cost of goods sold

• gross profit

• operating expenses

• the difference between revenue and cost of goods sold-in other words, the amount of money that a retailer makes before accounting for expenses.

• revenue

• cost of goods sold

• gross profit

• operating expenses

sometimes referred to as overhead, are the expenditures retailers incur during the course of normal business operations, such as rent and staff salaries.

• revenue

• cost of goods sold

• gross profit

• operating expenses

is the difference between revenue and expenses, including all of the expenses of buying product and producing any products and operating the company.

• revenue

• net profit

• gross profit

• operating expenses

• is the difference between the price an item is sold for and the price the retailer paid for the item. 

• profit margin

• net profit

• gross profit

• operating expenses

• is the percentage by which the revenue from sales exceeds business costs for items

• profit margin

• net profit

• gross profit

• profit margin percentage

of a product is the amount paid by the retailer to the manufacturer or supplier for an item.

• profit margin

• The cost

• gross profit

• profit margin percentage

• of a product is the amount the customer pays the retailer for a product. 

• profit margin

• The cost

• The retail price

• profit margin percentage

is the amount added to the cost of a product to cover expenses and provide a profit.

• A markup

• The cost

• The retail price

• profit margin percentage