From the course: Corporate Financial Statement Analysis
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The many ways to define income and profit
From the course: Corporate Financial Statement Analysis
The many ways to define income and profit
- Hey, any idea what Microsoft's margins were last year? - (laughing) Which margins are you talking about? - Wait, there's more than one? - Yeah, there's more than one. - Well what about Microsoft's profit? Do you know what that was last year? - Profit, I mean which one? - What, there's more than one of those? - Yeah. - Okay, simple question: what about Microsoft's net income? Do you know what that was last year? - Now income, there are lots of different incomes. - Oh, 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're not the same exact thing. Sometimes the terms are used interchangeably so it makes things a little confusing. - Okay, I'm confused. - I'm not surprised, that certainly doesn't surprise me, but let's see if we can clear things up for those watching. Here's Microsoft's income statement for the year-end in June 30th, 2018…
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