Net Sales

Definition - What does Net Sales mean?

Net sales is the amount of income that a company generates from sales after certain amounts have been subtracted. The amounts that have to be subtracted are returns, discounts, and the money from damaged or lost items. In the context of the law, net sales is an official figure that is included on official financial statements for companies.

Justipedia explains Net Sales

Net sales is an important figure for both potential investors of a company and for regulators of the company's industry. Net sales can help reveal how profitable a company is. A higher number of sales means that the company's products are in higher demand, and it can indicate that the company is more successful. However, the profitability of a company does not only depend on sales; it also depends on other factors such as profit margins and operating costs.

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