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Why is gross profit more important than net profit

User Venk K
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2 Answers

5 votes

Answer:

Because gross proft shows your money before expenses, so you know your actual revenue/sales

Step-by-step explanation:

User Barbakini
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gross profit shows how much money you made in relation to the cost of goods sold, this calculation is very important when you need to know wether a product is profitable or not. Net profit also substracts the expenses (building machinery,etc).
User Lukesivi
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