How to calculate gross profit
Gross profit (calculation)
To calculate gross profit, take your total sales and subtract the cost of making or selling your product.
Total sales - cost of goods sold = gross profit
Let’s say your business sells $12,000 worth of your product, and it cost you $8,000 to make those products. This would leave a gross profit of $4,000.
$12,000 total sales - $8,000 cost of making the product = $4,000 gross profit