How to read financial statement

Basic skills for market research

[1] Cost of goods sold: The direct costs attributable to the production of the goods sold by a company. 产品生产成本

[2]Gross Profit: or sales profit is the difference between revenue and the cost of making a product or providing a service, before deducting overhead, payroll, taxation, and interest payments

[3] SG&A: Selling, General and Administrative, a major non-production cost presented in an Income statement.

[4] Operating Expenses: include SG&A expenses, and R&D expenses

[5] Operating Income: a measure of profitability that tells investors how muc5 revenue will eventually become profit for a company.Operating income is also called Earnings Before Interest and Taxes (EBIT). It is important to understand what expenses are included and excluded when calculating operating income.

[6] Net Income: Operating Income + Non-operating Income — Taxes

References:

[1] http://www.investopedia.com/

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