The concept of “profit” is a weird thing. Its also a term that seems to have different meanings depending on context. Like, it absolutely won’t surprise me if there’s a “Marxian” definition of profit that doesn’t equate to a Business School 101 definition of profit that doesn’t equate to a Farmers Market vendor’s use of the term profit.

Until some quantity of capital is removed from a business, its not technically profit. But people will also view any value over the costs of selling something as profit, even if there are future costs that the current surplus could be used to to pay for.

So lets say that I have a small orchard and sell apples after the harvest. I’ve spent the year keeping track of expenses so I know how much “in the hole” I am. Harvest seasons comes around and I have apples to sell. If I compare sales revenue with my past expenses, for a while the revenue is less than my expenses. At some point, I hit the break even point where revenue and expenses are equal. If things are going decently, sales will continue until revenue will be greater than expenses.

From one perspective I didn’t make any profit at all, because I haven’t taken any of the revenue out of the “business”. From another perspective, I didn’t make profit until revenue exceeded the break even point (even though I didn’t remove capital). If I were to take money out of the business, spend it somewhere else, and find that my business had future expenses that coulda/shoulda been paid with the money that I took out of the business… “I, as the owner”, realized profit (by removing capital from the business) but the business didn’t make a profit (because the removed capital could have been used to continue funding business operations.)

So I guess this rambling is just a reminder to pay attention to the context that the term “profit” is being used as it will help to reduce confusion.