We have figured out how profitability is calculated. To calculate it, we will need indicators that any enterprise determines when summing up its work.
Organizations can use a formula for determining sales profitability based on the balance sheet, or more correctly, on its appendix, that is, the financial performance report. It contains:
revenue (indicated in line 2110);
operating profit (line 2200);
gross profit (written in line 2100);
net profit (written in line 2400).
As a rule, entrepreneurs use the honduras phone data formula for return on sales by net profit and revenue, since they do not form the above-mentioned financial report. To calculate the gross as well as operating profit, they must carry out detailed cost accounting. So they not only learn the ratio of return on sales on the balance sheet by the formula, but also use it to manage the organization.
Let's calculate the profitability of sales of an individual entrepreneur and compare the results for two periods. All the indicators required for this are given in Table 1.
Table 1. Performance indicators for the first and second quarters (in rubles)
Indicator 1st quarter 2nd quarter
Revenue 1 1,000,000 1 100 000
Cost of production of clothing 2 450,000 495,000
Gross profit (difference between lines 1 and 2) 3 550,000 605,000
Costs of management processes 4 50,000 50,000
Costs of implementation 5 300,000 350,000
Operating Profit (Line 3 – Line 4 – Line 5) 6 200,000 205,000
Tax (simplified tax system 15%) (line 6 × 15%) 7 30,000 30 750
Net income (difference between lines 6 and 7) 8 170,000 174 250
The second period shows growth in all forms of profit, including revenue. However, it is always important to analyze the profitability of the business, even if you are confident that the work is being done correctly.
Profitability of the first period:
By gross profit (according to the return on sales formula): 550 thousand / 1,000 thousand x 100 = 55%.
In terms of net profit: 170 thousand / 1,000 thousand x 100 = 17%.
In terms of operating profit: 200 thousand / 1,000 thousand x 100 = 20%.
Payments for the next period:
By gross profit: 605 thousand / 1,100 thousand × 100 = 55%.
Net profit: 174.25 thousand / 1,100 thousand × 100 = 15.8%.
The profitability found from operating profit was: 205 thousand / 1,100 thousand × 100 = 18.6%.