MGTA01H3 Chapter Notes - Chapter 9: Earnings Before Interest And Taxes, Net Profit, Balance Sheet

• School: UTSC
• Department: Management
• Course: MGTA01H3
• Professor: Chris Bovaird

Document Summary

Chapter 9 measuring performance: the financial statements. Income statement: the financial statement that shows how much revenue the business generated, and the costs incurred, in the course of making and selling products. If not, means that revenue is growing less quickly than economy generally cost of sales: the cost of making the product itself, and omits all of the administrative costs of running the business. The profit that comes from selling products. operating expense: the cost of running the business organisation, as opposed to the cost of making the product. Also called general or administrative expense or fixed expenses. The profit made from operating a business that sells products. Interest expense: the interest costs of borrowing money to finance the business. Not the loan itself, just the interest paid on loan. Sole proprietors/partners treat income from employment as personal income and pay tax at marginal personal rate. Corporations are separate legal entities from owners and pay taxes in own name.