What is calculated by subtracting the cost of goods sold from sales or revenues?

The correct answer is gross profit, which is a key financial metric indicating the efficiency of a company's core operations. Gross profit is derived by subtracting the cost of goods sold (COGS) from total sales or revenues. This calculation reveals how much money the company makes from its sales after accounting for the direct costs associated with producing the goods that were sold.

The importance of gross profit lies in its ability to provide insight into the profitability of the company's core activities before administrative and other indirect costs are factored in. It helps assess how well a company converts its sales into actual profit from the goods it sells.

Operating income and net income, while related, involve further deductions beyond just COGS. Operating income takes into account operating expenses like selling, general, and administrative expenses, while net income also considers all non-operating items, taxes, and interest expenses. Dividends per share, on the other hand, refers to the distribution of a portion of a company's earnings to its shareholders and is not directly related to sales or revenues. Thus, gross profit distinctly highlights the initial profitability from direct sales against the costs incurred, making it the correct answer.