From the course: Corporate Financial Statement Analysis

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Discern the many ways to define income and profit

Discern the many ways to define income and profit

From the course: Corporate Financial Statement Analysis

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Discern the many ways to define income and profit

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Any idea what Microsoft's margins were last year? Which margins are you talking about? Wait, there's more than one? Yeah, there's more than one. What about Microsoft's profit? Do you know what that was? Well, profit, which one? Wait, there's more than one? Yeah, there's more than one. Okay, simple question. What about Microsoft's income? Do you know what that was last year? Okay, income, which one? I thought these were simple questions. Profit, margin, income. Aren't these terms all after the same thing? How well a company is doing? Well, those terms are all after the same thing, but they are not the same thing. And sometimes the terms are used interchangeably, so it makes things even more confusing. Well, now I'm confused. Yeah, I'm not surprised. That certainly doesn't surprise me at all, but let's see if we can clear things up for those watching. Here's Microsoft's income statement for the year ended June 30, 2025. Pretty typical income statement. Now, in this, I see the term gross…

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