ESP111 Unit 13

shows how gross profit (or loss) has been made from the trading activities of the business.

• trading account

• revenue

• net profit

• gross profit

calculates three profit figures: profit from operations (or operating profit); profit before tax; profit for the year

• revenue

• profit or loss account

• depreciation

• liabilities

the cost of producing or buying in the goods actually sold by the business during a time period.

• Prepaid Expenses

• Operating Expenses

• Amortization

• Cost of goods sold (COGS)

items of value which are owned by the business,; they may be fixed or short-term current assets.

• Current assets

• Non-current assets

• Assets

• Non-current liabilities

debts owned by the business.

• Liabilities

• Non-current liabilities

• Current Liabilities

• Amortization

the ongoing costs of running the business and may include items such as rent, employee payroll, depreciation, etc.

• Operating Profit

• Operating Expenses

• Operating Income

• Cost Of Goods Sold (COGS)

the profit made by a business after all costs have been deducted from sales revenue.

• Revenue

• Net profit

• Operating profit

• Gross profit

the fall in the value of a fixed asset over time. This is included as an annual expense of the business.

• Operating expenses

• Amortization

• Depreciation

• Expenses

an accounting term that refers to an expense that is recognized on the books before it has been paid.

• Accrued Liabilities

• Operating Expense

• Prepaid Expense

• Non-current Liabilities

goods or services paid for upfront where the company expects to use the benefit within 12 months.

• Overheads

• Accrued expense

• Prepaid expense

• Operating expense