
Gross Profit vs Net Profit: A Small Business Guide
Compare gross and net profit formulas, margins and business uses with a worked example showing how direct costs, overhead and tax change the result.
8 articles explaining how to use the Business Profit Calculator, with examples and answers to common questions.
Open the Business Profit Calculator

Compare gross and net profit formulas, margins and business uses with a worked example showing how direct costs, overhead and tax change the result.

Learn why a profitable business can face a cash squeeze, how invoices, inventory and loan principal change timing, and how to reconcile profit with cash flow.

Learn how revenue, COGS, inventory, discounts, and productivity affect profit and margin, with clear calculations and calculator steps.

Learn how gross, operating, pre-tax, and net profit connect, with formulas, a worked income statement, and calculator steps for checking each figure.

See how to turn revenue and the right profit figure into a percentage, work through a small-business example, and use a target margin to price products.

Follow revenue, COGS, SG&A, taxes, and non-operating items through a multi-step income statement, then calculate each margin with a worked example.

See how fixed costs, variable costs, contribution margin, and pricing determine the sales revenue and units needed to reach zero profit or a target profit.

Learn how to measure business profitability with gross, operating, and net margins, choose matching periods, calculate a yearly example, and read trends.