Profit and loss accounts and income statements


  • Operating profit - The profit made by a business as a result of its ordinary trading activities.
  • Profit and loss account - A financial document showing a company's revenue and costs over a particular time period, usually one year.
  • Profit and loss account - Shows net profit after tax by subtracting business expense and taxation from operating profit.
  • Profit and loss appropriation account - Shows how the profit after tax is distributed between shareholders and the business.
  • Profit quality- Occurs when profit are sustained over a period of time; there is low profit quailty if profit in one time period is mainly due to some one-off factor which is not sustainable.
  • Profit utlisation - The way in which profit made by a business is distributed.
  • Trading account - Shows operating by subtracting the cost of sales from turnover
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