Business FinancesQuestion 1225 of 1605
A contractor wants to know the profit built into a bid before overhead. That figure is the:
a.Net profit
b.Current ratio
c.Gross profit (revenue minus direct job costs)
d.Retention
Explanation
Gross profit is revenue minus direct job costs (labor, materials, subs, equipment for the job). Overhead is then subtracted from gross profit to arrive at net profit. Knowing gross profit shows how much a job contributes before covering fixed business costs.
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