To calculate his company's _______________, Edgar will subtract operating expenses from gross profits.

Question

Quizplus · Accepted Answer

Operating profit is the profit generated from a company's operations after deducting operating expenses from gross profits. Therefore, it is the appropriate measure that Edgar should calculate in this situation. Cost of goods sold is the direct cost associated with producing a product, profits before taxes is the income earned before paying taxes and retained earnings is the portion of net income that is kept by the company rather than distributed as dividends to shareholders. While these are all important financial metrics, they are not relevant to the calculation that Edgar needs to make.

To Calculate His Company's _______________, Edgar Will Subtract Operating Expenses