________ is what remains when you subtract fixed and variable costs and taxes from revenues.

Question

BlackTom AI · Accepted Answer

When approaching this question, we first recall what each financial metric represents and what is subtracted from revenues to arrive at the figure.
Option 1: Gross margin. This is typically defined as revenues minus the cost of goods sold, not accounting for other operating expenses or taxes. It does not reflect all fixed and variable costs plus taxes, so it is not the correct description in this context.
Option 2: Gross profit. Similar to gross margin, gross profit equals revenues minus cost of goods sold, and still ignores many other costs beyond COGS such as operating expenses and taxes. Therefore, it does not match the description given in the question.
Option 3: Net profit. This term denotes the amount remaining after subtracting all costs from revenues, including fixed costs, variable costs, and taxes (and sometimes interest). This aligns precisely with the description in the prompt, as it encapsulates all deductions from revenue to yield the final bottom-line figure.
Option 4: Operating profit. Also known as EBIT in some contexts, operating profit subtracts operating expenses from gross profit but does not account for taxes (and often not for interest). It therefore leaves out taxes, so it does not equal the amount remaining after taxes are subtracted from revenues.
In summary, the statement that matches subtracting fixed and variable costs and taxes from revenues corresponds to net profit, while the other options describe related but incomplete measures of profitability.

GBUS4330W01 25 Fall GBUS 4330 Quiz 2 - Requires Respondus LockDown Browser

________ is what remains when you subtract fixed and variable costs and taxes from revenues.

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GBUS*4330*W01 25 Fall GBUS 4330 Quiz 2 - Requires Respondus LockDown Browser

________ is what remains when you subtract fixed and variable costs and taxes from revenues.

View Explanation

Log in for full answers

Similar Questions

Net profit increases when

_____ is the difference between a company’s revenues and all of its expenses.

Another name for "Net Income" is ________.

Calculate the net profit for the firm if its total revenues are $123,201 and total expenses are $35,569.

Given this information, calculate the net profit for the business. Sales revenue 106,034 Unearned revenue 2,412 Dividends 5,389 Cost of sales 32,535 Interest revenue 3,395 Operating expenses 11,339 Income tax expense 2,207

Consider the following information for Ball CorpWhat is the Net Profit?

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GBUS4330W01 25 Fall GBUS 4330 Quiz 2 - Requires Respondus LockDown Browser