Revenue

• Most income statements are organized so that the business's revenues for the period are listed first. Depending on the business in question, the revenue section tends to be much smaller than its expenses section. Most businesses will list revenues for its main operations in addition to any revenue from secondary sources. Many will not have secondary sources of revenue and will therefore restrict their sections on revenue to one or two lines.
  
  

Gross Profit

• Gross profit is calculated as total revenues minus a business's Cost of Sales, which is also called Cost of Goods Sold or Cost of Services Sold or a similar name depending on the nature of the business's revenue-producing operations. Cost of Sales includes all costs incurred by the business in acquiring the goods and/or services that it intended for sale and were sold in the period, whether said products were manufactured or purchased from suppliers.
  
  

Operating Profit

• Operating Profit is calculated as a business's Gross Profit for the period minus its operating expenses. Said figure is also called either profit before interest and taxes or earnings before interest and taxes. Operating expenses are defined as all expenses that continue period after period and that are used to keep the business running. Administrative, sales and research expenses are all included in this category.
  
  

Net Income

• Operating profit minus interest and taxes produces a business's net income for the period. Net income can be thought of as the business's financial gain for the period. A negative net income is called net loss and is likewise a business's financial loss for the period. Interest and tax expenses are not included in any category of expenses and instead occupy a category of their own.