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Question
What is the difference between ‘Operating Profit’ and ‘Net Profit’?
Distinguish Between
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Solution
| Sr. No. |
Operating Profit | Net Profit |
| 1. | Measures efficiency in the core operations of the business. | Indicates the overall profitability, including both operational and non-operational factors. |
| 2. | Focuses on the company’s operational efficiency. | Represents the overall profitability, including non-operating activities. |
| 3. | Does not include non-operating income (e.g., interest income, investment income). | Includes all non-operating income, such as interest income or gains from asset sales. |
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