Profit and Loss terms

Term	Definition
Sales	The operating revenues earned through business activities, e.g. selling goods, services, products, etc.
Cost of sales	The cost attributable to the production of the goods and services, e.g. direct labour and materials used to make the goods
Gross profit	Profit made after deducting cost of sales
Other op. Income/cost	Operating Income includes revenues from all other operating activities not related to the principal activities of the company. Operating Cost includes expenses associated with the maintenance and administration of the business
Operating profit	Profit before income, interest and taxes
Exceptional items	Unusually large & uncommon transaction charge
Interest & other income	Interest Income on amount earned on investing activities
Interest paid	Interest payable on any borrowings e.g bonds, loans, convertible
Profit before tax	Profit before the company pays its taxes
Tax	Proportion of the income of a company that must be paid to the government
Profit after tax	Profits remaining after taxes are paid
Dividends	Money regularly paid out by a company to its shareholders out of its profit or reserves
Retained profit	The amount of Net Income left over after the business has paid out dividends to its shareholders
Interest receivable	The amount of interest a company receives from any of its interest bearing investments
Profit / Loss on disposal	The profit or loss made from the disposal or sale of assets.
Total operating lease rentals	The total amount spent on renting of assets for use in the business without conveying the ownership rights of the assets
EBITDA (calculated)	Earnings before interest, taxes, depreciation and amortisation - calculated by adding depreciation and amortisation to operating profit
Operating profit includes the following:
Depreciation	The accounting method of allocating the cost of a tangible asset over its useful life
Amortisation of intangibles	The accounting technique used to periodically lower the book value of an intangible asset over a set period of time
Employee costs	The actual amount paid for employee wages and benefits
Auditors' remuneration - audit	Fees a company pays an external auditor in exchange for performing an audit
Auditors' remuneration - non-audit	Fees a company pays an external auditor in exchange for performing non-audit work
Employees' additional information:
Number of employees (heads)	The number of people per head employed in a company
Directors remuneration	Process through which directors of a company are compensated e.g through fees, salary or the use of the company’s property