What is the difference between Operating expenses and Nonoperating activities (expenses)?
Operating Expenses are simply all cost of runing the operation, apart from product cost (in Cost of Goods Sold). Any other expenses then are nonoperating, such as Interest expense, Interest and Dividend income, gain or loss on sale of fixed assets.
Difference cost of goods sold and operating expenses?
Cost of Goods Sold is a direct cost you can track to the item; whether it is manufactured by you or bought for resale. The purchase price of inventory, materials (in manufacture), the freight in, the direct labor (such as salesman's commission or the assembler's payroll) etc. Operating costs are indirect costs; rent, office payroll, general supplies, etc. Since it is a general expense incurred whether or not you make or sell something; in other words, you incur these costs regardless of sales or production.
What is the difference between operating expenses and SG&A?
Operating expenses are those expenses incurred by a business that are not attributable to the production of goods or the provision of services.Operating expenses include line items such as:rentequipmentinventorymarketingpayrollinsuranceresearch and developmentSG&A stands for “sales, general and administrative,” which is sometimes presented as the sum of all of the aforementioned line items.Sales expense includes direct and indirect expenses associated with the sale of goods or provision of services, including labor (salaries) excluding production of the goods or services, advertising, rent, taxes, etc.General expenses are those that relate to the operation of the company but which don’t fit in either the “sales” category or the “administration” category.Administrative expenses include executives’ salaries and other costs related to the administration of the company.
What is the difference between Operating income and Net income?
OPERATING INCOME :-Operating income is the income you generate through your operations. This is your revenue from sales of products and services performed in your daily business operations less the expenses it takes to produce and sell them. Operating income does not take into consideration: income from investments, expenses from financing or taxes, or one-time extraordinary expenses or income items, such as the gain on the sale of an asset.OPERATING INCOME FORMULA :-Operating Income = Gross Income – Operating Expenses – Depreciation & AmortizationNET INCOME :-Net income is the final bottom-line income for your business. If your operating income is $125,000 and you paid $10,000 interest on your loan, $12,000 in taxes, and you had $1,000 in dividend income, your Net Income would be $104,000 ($125,000 +$1 ,000 – $10,000 – $12,000).NET INCOME FORMULA :-Net Income = Operating Income + Investment Income – Interest Expense +One-time Extraordinary Income – One-time Extraordinary Expenses – TaxesWHY ARE THEY DIFFERENT?The reason for the distinction? Operating income represents how the revenue and expenses flow in and out from business operations alone, regardless of whether your business operates on debt or has extra cash reserves. If your operating income is healthy, your business value will likely be healthy regardless of your net income.ByAkbar Khan
What is the difference between Operating Cash Flow and Operating Profit?
Operating cash flow describes the amount of cash generated from (or used by) operating activities and excludes cash generated (or used by) financing and investing activities. This number can be found a company's statements of cash flow.Operating profit, also called earnings from operations or operating income, describes the difference between revenue generated minus operating expenses (including cost of sales). It is a measurement that is before any income taxes and non-operating activities. This number can be found on the income statement (also called the statements of operations).
What is the difference between operating income and Net profit?
operating income is operating revenues - operating expenses. net profit is calculated by taking your gross profit, minus overhead costs, minus interest payments and plus/minus any "one off" items in a nutshell, operating income is part of the calculation for Net Profit. Take a look at this breakdown: 1. Sales Revenue = Price (of product) X Quantity Sold 2. Gross profit = sales revenue – cost of sales and other direct costs 3. Operating profit (EBIT, earnings before interest and taxes) = Gross profit – overheads and other indirect costs 4. Pretax Profit (EBT, earnings before taxes) = operating profit – one off items and redundancy payments, staff restructuring – interest payable 5. Net profit= Pre-tax profit – tax 6. Retained earnings = Profit after tax – Dividends
The difference between cost of goods sold and cost of goods manufctured?
In cost Accounting, the Cost of Good Manufactured is from your work in process or WIP in the cost system. So lets start in the beginning of a Cost System in a Manufacturing company. First you have raw materials, the calculation is: all () means subtract Beg RM + Purchases =RM Available (Ending RM) = Material Used The Material Used gets transferred over to WIP, calculation is: Beg WIP +Direct Material (This is from Material used above) +Direct Labor +Applied Manufacturing Overhead (Applied not actual) =WIP Available (Ending WIP) =Cost of Good Manufactured or CoGM This gets transferred over to Finished Goods. Calculation is: Beg FG +CoGM =FG Available (Ending FG) =Cost of Goods Sold This goes over to the Cost of Goods Sold, and the calculation is: CoGS (from Finished Goods) +Underapplied overhead (Overapplied overhead) =Cost of Goods Sold (This is the amount that will be reflected in your financial) So your CoGM remains in your WIP account which is referenced on your Balance Sheet, whereas your CoGS, is reflected on your income statement. (It's been a long night, I hope it made sense to you)
What is the difference among SG&A, COGS and OPEX?
Cogs stands for cost of goods sold and as the acronym suggests is the cost of the items sold. For example if you produce 50 items each costing a dollar and sell 20, your COGS is 20SG&A is selling general and administrative cost and is a period cost unlike COGS which is a product cost. Examples of SG&A costs are advertising or executive salaries OPEX stands for operating expenditures such as SG&A or R&D think of the cost for running your day to day business