An increase or decrease in revenue might not necessarily mean more or less profit. In my opinion, there are many other accounting factors that will ultimately determine profit gains or losses. For example, a company could experience an increase in revenue but more expenses, as well. If revenue is increased and no other factors have changed, then there will be a gain in profit.
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why does revenue increase when the gross profit margin decreases?
The cost of goods sold includes labor costs. If a company increases production, it will incur other costs such as overtime for its current workers, as well as a cost to hire and train…more
What is more profitable for a company, decreasing costs or increasing revenue.?
Increasing revenu does not always measure out to increase in profit. Cost is the main element. If cost are low and an increase in revenue would be good. If cost are high than it may…more
How can profit margin decrease as revenues increase?
revenue profit will only decrease if there is a loop hole in the chain, take note that everything rise with profit but when it comes to expenses you will have a revenue decrease in …more
Why increase in revenue will decrease the net profits?
This can happen if your costs increase more than the increase in revenue. Example: You have 10 shirts which cost you $20 each, and you sold them all at $30 each. So Sales $300 less …more