3 paragraphs – 1000 words (NO PLAGIARISM)
Every business owner or manager wants to turn a profit on merchandise sold, but not every owner or manager has the luxury of having both high gross profit and high net income. Some businesses may experience favorable gross profit numbers, yet see red on their bottom line. How could this happen?
From the perspective of a CFO for your organization, discuss how would you explain to your CEO how the business can be experiencing good gross profit, yet continue to post net losses on the income statement.