Gross Sales
Definition
Gross sales is total sales before any returns, discounts, or allowances are subtracted. Net sales is gross sales minus those reductions.
Example
A business sells $10,000 of products. A customer returns $500 and takes a $200 discount. Gross sales are $10,000; net sales are $9,300.
Why It Matters
Gross sales shows total selling activity, while net sales shows what the business actually kept. Both are useful for different kinds of analysis.