And then if you subtract your costs from your revenue, or if you just add these two numbers, because this one is negative, you have your gross profit.

Utilities are still rewarded when their customers waste energy.

And then I'll do a more philosophical video on why these things even exist, and why they're useful, and why people may benefit or may not benefit from these things.

And at least it'll give you a sense of how revenues, gross profit, operating profit, pre tax income and net income really are different.

And here are the most surprising results.

And this is the profit from the operations of the company, or you could say from the assets or from the business or from the enterprise of the company.

I'm making 300,000 by providing this service by matching up the savings with good investments.

You want to have a lower Price to Earnings ratio for the same asset.

So most cash flow statements, they'll start so I'm going to do a cash flow statement right over here

He derived great benefit from the book.

In a word, he gained much profit.

They have to give permission to let the stock be borrowed, and they benefit, because they get some cut, hopefully, they get some cut of the rent, or the interest that I'm paying.

With far too few of your sinister plots actually turning a profit.

You can either profit by this or be destroyed.

And you'll hear these numbers, gross and operating profit and net profit and pretax profit, and it's very hard to understand that these are actually very, very different things, because they all have the word profit, and what does gross and operating and all that mean?

The pie's getting bigger because these are real investments that are going to benefit my village.

So this is buy 10 apples for 10, and then you would sell those 10 apples for 15.

Cash is a asset because you can use it to buy stuff and get people to do stuff for you

For example, when you're offered 50 dollars now or 60 dollars in a month.

When you look at elementary school children, we have hundreds and hundreds of millions of children around the world that could benefit tremendously from being able to be connected to the Internet.

It looks like we lost 200.

These are the only people who really have, arguably the sophistication and the time and the monetary incentive to really look and scrutinize what management is doing.

Both of them are equilibriums because neither of the players can benefit from switching to the other strategy.

And the reason why there's a different term is, sometimes you can have the non operating profit.

If I could borrow some of their money and use it to pay people that will essentially do the goods and service or do the new project, then I'll generate wealth.

And here too, you can see the implications in the world at large.

Why isn't it on every poster across the third world?

You'll see this TTM sometimes.

They have no interest expense, because that's not the point of this video.

They're generating the operating profit, and that's a very important thing to realize in the future when we talk about return on assets.

They obtained a yield of 8 percent on their investment.

With trade, there's mutual interdependency and mutual gain between parties.

It affects your sales model. Are you going to hire direct sales? When do you hire them?

A company is a business organization with sales, a product, or service in exchange for revenue and profit.

Obviously this depends whether you're selling to business customers or consumer customers, but you want to be able to make a list or a column of all the gains that they would get by using your product.

It's dependent on how the operations were financed.

So that's going to be 500,000 a year.

It has no choice but to behave.

And the song, 18 months old, went back to number four on the iTunes charts.

That's what it is generating.

So this is the operating profit. This is the money that just comes out of the asset itself.

That actually brought the entire search industry from on its way down to being one of the most profitable parts of web commerce.

It is from advertising that a newspaper earns most of its profits.

And then they'll say well in the most naive interpretation of things, you net income in theory should be the cash you're getting or at least it's some type of profit you're getting assets in the door or at least you're counting as if you're getting some assets in the door.

And when people talk about earnings of a company, this is what they're talking about.