Gross profit is the profit a company makes after deducting the costs associated with making and selling its products, or the costs associated with providing its services. Gross profit will appear on a company's income statement and can be calculated by subtracting the cost of goods sold (COGS) from revenue (sales). These figures can be found on the company’s income statement. Gross profit may also be referred to as sales profit or gross income.

Formula for Gross Profit

1.   Gross Profit = Revenue - COGS