Definition: Gross profit is the profit a company makes after deducting the costs associated with making and selling its products, or the costs associated with providing its services. Gross Profit will appear on a company's income statement and can be calculated by subtracting the cost of goods sold (COGS) from revenue (sales). These figures can be found on a company's income statement. Gross profit may also be referred to as sales profit or gross income.

In Plain English: Gross profit is the money you have left from selling products or services once you subtract the cost of creating or performing them. This does not include the other expenses for running your business, such as rent.

Example: If you sold a shoe for $100 and the cost of making that shoe was $40, your Gross Profit would be $100-$40=$60

Gross profit shows you how much money you have gained after creating and selling a product, which tells you how much money you have for other operating expenses for your business.