1. Profit: The excess of revenues of a period over its related expenses during an accounting year is profit. Profit increases the investment of the owners.
2. Gain: A profit that arises from events or transactions which are incidental to business such as sale of fixed assets, winning a court case, receipt of interest and dividend, etc. Gain is irregular in nature. Gains are part of capital receipt. Gains are also known as “non-operating income.”
