Profit = Revenue – Costs
Net profit represents the material assets that ultimately remain after deducting deductions, all taxes and other payments from the balance sheet profit. An indicator such as net profit is used to calculate the necessary investments in the production process, to plan and organize the main reserve funds, as well as to increase current assets.
Generally speaking, the amount of net profit directly depends on several factors:
Tax burden on the enterprise, as well as additional deductions;
- amount of revenue;
- calculated cost of production and so on.
In order for the calculation of net profit to be correct, it is first necessary to carry out the following operations step by step:
Calculate the sum of all costs associated with the production of products, taking into account the costs of materials;
Calculate an indicator such as gross income. To calculate gross income, it is necessary to subtract the amount of expenses associated with the production of goods from the amount of funds received from the sale of products;
As a result, you need to use the formula: Net profit = Gross income – mandatory payments.
Profit declaration
Before preparing reports, you need to carefully check your counterparties. Especially those who are your debtors. You shouldn't wait three years. Please note that since last year, important amendments to the Civil Code of the Russian Federation came into force.Composition of the income tax return:
Title page;
Section 1 “The amount of tax payable to the budget, according to the taxpayer”;
sheet 02 “Tax calculation”;
Appendix No. 1 to sheet 02 “Income from sales and non-operating income”;
Appendix No. 2 to sheet 02 “Expenses associated with production and sales, non-operating expenses and losses equated to non-operating expenses”;
Appendix No. 3 to Sheet 02 “Calculation of the amount of expenses for operations, the financial results of which are taken into account when taxing profits, taking into account the provisions of Articles 268, 275.1, 276, 279, 323 of the Tax Code of the Russian Federation (except for those reflected in Sheet 05)”;
Appendix No. 4 to sheet 02 “Calculation of the amount of loss or part of a loss that reduces the tax base”;
Appendix No. 5 to sheet 02 “Calculation of the distribution of advance payments and corporate income tax to the budget of a constituent entity of the Russian Federation by an organization that has separate divisions”;
Appendix No. 6 to sheet 02 “Calculation of advance payments and taxes to the budget of a constituent entity of the Russian Federation for a consolidated group of taxpayers”;
Appendix No. 6a to sheet 02 “Calculation of advance payments and taxes to the budget of a constituent entity of the Russian Federation for a participant in a consolidated group of taxpayers without those included in it separate divisions and (or) according to its separate divisions";
Appendix No. 6b to sheet 02 “Income and expenses of members of the consolidated group of taxpayers who formed the consolidated tax base for the group as a whole”;
sheet 03 “Calculation of corporate income tax withheld by the tax agent (source of income payment)”;
sheet 04 “Calculation of income tax calculated at rates different from the rate specified in paragraph 1 of Article 284 of the Tax Code of the Russian Federation”;
sheet 05 “Calculation tax base for corporate income tax on transactions, the financial results of which are taken into account in a special manner (except for those reflected in Appendix No. 3 to sheet 02)”;
sheet 06 “Income, expenses and tax base received by non-state pension fund from the placement of pension reserves";
sheet 07 “Report on the intended use of property (including Money), works, services received as part of charitable activities, targeted income, targeted financing”;
Appendix No. 1 to the tax return “Income not taken into account when determining the tax base, expenses taken into account for tax purposes by certain categories of taxpayers”;
Appendix No. 2 to the tax return “Information on income individual, paid to him by a tax agent, from transactions with securities, transactions with financial instruments forward transactions, as well as when making payments on securities of Russian issuers.”
Procedure for filling out an income tax return
The procedure for filling out an updated income tax return is also approved by Federal Tax Service Order No. ММВ-7-3/600@.
All organizations must include in the declaration the title page, subsection 1.1 of section 1, sheet 02, as well as appendices No. 1 and 2 thereto.
The remaining sheets, subsections of section 1, as well as appendices 3-5 to sheet 02 are submitted only by those organizations that carry out the relevant operations and have indicators for them.
In this case, subsection 1.2 of section 1 is not included in the declaration for the year. Appendix No. 4 to sheet 02 is presented as part of the declaration for the first quarter and year. Sheet 07 is filled out by organizations when receiving targeted funding, targeted revenues and other funds only in the annual declaration.
Organizations that pay advance payments monthly based on the actual profit received submit a declaration in the specified amount for the first quarter, half a year, 9 months and a year. Based on the results of other reporting periods (January, January - February, January - April, etc.), the title page, subsection 1.1 of section 1 and sheet 02 are filled out. If there are relevant operations and (or) separate divisions, subsection 1.3 of section is also included in such a declaration 1, Appendix No. 5 to sheet 02 and sheets 03 and 04.
Organizations that have separate divisions submit a separate declaration at their location, consisting of: title page, subsection 1.1, subsection 1.2 of section 1 (when paying monthly advance payments during reporting (tax) periods) and Appendix No. 5 to sheet 02 with indicators related to this separate division or to a group of separate divisions located in one subject of the Russian Federation, if the tax is paid through one division.
Changes have been made to clause 3 of Art. 256 Tax Code of the Russian Federation. So, if an object is transferred for reconstruction for a period of more than 12 months, then for tax accounting purposes the accrual of depreciation stopped. And this was a headache for the accountant. Moreover, most often during modernization, part of the facility continues to be used.
Organizational profit
An organization's profit is the difference between revenue and the cost of products or services provided.On the market, the enterprise acts as an independent commodity producer. By selling its products, the company independently sets the price for it and receives trading revenue. But this does not mean at all that the activity will be profitable. To determine the final financial result it is necessary to compare revenue with the cost of the product, that is, with the sum of all costs for its production and sale.
Regarding profit, it is important to note the following:
1) The amount of revenue exceeds the cost of production - the company made a profit.
2) If the profit is equal to the cost of the product, then the company was only able to recover its costs incurred for its production and sale.
3) If the profit margin is less than the cost of production, then this is a negative result. The company suffered a loss, which could lead to bankruptcy.
The income and profit of the organization is the main source for financing the company's activities. The firm's gross income is the proceeds from the sale of products, goods and services minus all production costs, including wages.
Profit is the most important indicator of a company’s commercial and economic activities. The organization's profit is calculated in monetary terms.
In a market economy, a company must strive, if not to obtain maximum profit, to achieve results that will allow it to consolidate its position in the market, produce competitive products and ensure the dynamic development of its activities.
Profit is the most important criterion in a market economy. This is the meaning entrepreneurial activity, its main engine. If a businessman makes a profit that only covers production costs, then it is uneconomical. There is no point in running such a business.
The main source of profit is the essence of entrepreneurial activity. The stimulating essence has a dual character: In one situation, it is an effective incentive for entrepreneurship. In a market economy, everyone receives their own income: the businessman receives profit, and the staff receives wages. In another case, profit has an exploitative nature. An entrepreneur can partially appropriate the results of the work of his employees. That is, in certain cases the amount of profit is proportional to the level wages. And, if the owner of the company increases profits by reducing wages to employees, then this part of the income will have an exploitative nature.
Of course, everyone cannot receive the same income, but such chaos should not happen, since it contradicts the canons of a market economy.
Profit has great value for the state as a whole and for all its sectors of the economy.
This is the most important indicator of efficiency and the financial result of the company’s activities. Profit is the basis for calculating the profitability of an enterprise (the ratio of profit to production costs). Accounting for the organization's profit is also of great importance, since the entire activity of the company depends on it.
Profit is:
The main source of equity capital formation for any enterprise, financing current activities, production development;
the main source for increasing the movable and immovable property of the company;
the main protection of the enterprise from bankruptcy. Also in this case, the rule works: “profit – fixed assets”. In this scheme, its regularity in the required sizes is of great importance;
the main source of satisfying national needs, since profit is the basis for calculating a series of taxes that fill the state budget.
Due to profit:
1) The revenue side of the budget is formed.
2) Social infrastructure facilities are being developed: schools, kindergartens, hospitals and other institutions.
3) The country's defense is financed.
The larger the profit margin of enterprises, the more stable the national economy and its currency. There is an increase in macroeconomic indicators, and as a result, the level of inflation decreases and the material security of the population improves.
Analysis of the organization’s profit allows us to highlight its main functions:
1) Firstly, profit reflects the economic effect that was achieved as a result of the company's activities. If a company is profitable, this means that its income is greater than all the costs associated with its activities. However, not all aspects of a company's activities can be measured using profit. And such a universal indicator cannot exist. To evaluate production economic activity companies use a whole system of indicators. The main meaning of profit is that it determines the financial result.
2) Secondly, it performs a stimulating function. Profit is not only the financial result of an enterprise’s activities, but also the main source for the formation of equity capital. The company is interested in obtaining maximum profit, since the part of it remaining after paying taxes and other payments is used to expand the business, social development company, payment of bonuses to staff.
3) Thirdly, it is the main source of creating budgets at different levels. By paying taxes, it influences the formation of the budget, guarantees that the state fulfills its functions, and finances investment and social programs.
There are three main sources of profit generation:
The first is formed due to the monopoly of a company in the production of one or another type of product, that is, the uniqueness of the product is meant. In order to maintain this source of profit, it is necessary to regularly modernize products and improve their quality. It is also necessary to remember about the antimonopoly policy of the state and growing competition from other companies in the market.
The second source - the formation of the organization's profit is associated with the entrepreneurial and production activities of the company. This applies to almost all companies. This source will be effective only if the market conditions have been studied, and there is also the ability to constantly adapt to all changes occurring in the market. To accomplish these tasks it is necessary to carry out marketing research.
The amount of profit received in this situation will depend on:
A) from the right choice production strategy for the production of products or provision of services (you need products that will be in demand in the market);
b) from creating competitive conditions for the sale of products (price, delivery terms, after-sales service);
c) on the volume of production of goods (the more products are produced, the greater the profit margin);
d) from the structure of reducing production costs.
The third source of profit is formed from innovation activity enterprises. As a result, products are constantly updated, their quality and competitiveness are improved, sales volumes increase, and, accordingly, profits.
Types of enterprise profit
According to Accounting Regulation No. 43 “Accounting Statements”, approved by order of the Ministry of the Russian Federation, each enterprise must maintain financial statements, including a report in Form 2. It is called the “Profit and Loss Statement”. Its form lists all types of profits that the company can receive. Let's look at them in more detail.
Gross profit is the difference between revenue from the sale of goods and services and the cost of the same products. The amount of profit from sales is influenced by criteria such as sales costs and management costs, if they are related to the main activity of the company.
At the next stage, taxable profit (loss) is determined.
When calculating it, the following should be taken into account:
The amount of profit on which tax has already been paid;
profit that falls under the benefits provided to the enterprise;
profit that falls under a special tax regime;
profit, which increases the base for tax calculations due to excess of limited expenses (personnel training, advertising costs, payment of interest on a loan, depreciation).
Net profit should also be highlighted. It is used for the following purposes:
Development of new production areas;
payment of dividends and other material payments to the founders, owners and shareholders of the company;
formation of a consumption fund;
payment of fines for violation of environmental legislation, inflated prices, late payment of budget payments, tax evasion.
In order for the company's activities to be profitable, it is necessary to regularly conduct financial and factor analysis, calculate the final results, and compare them with indicators of past periods.
Gains and losses report
The income statement characterizes the organization's performance for the reporting period and shows how it achieved profits and losses (by comparing income and expenses).The income statement, together with the balance sheet, is an important source of information for a comprehensive analysis of profitability.
The information presented in the report allows you to assess the change in the organization’s income and expenses in the reporting period compared to the previous one, analyze the composition, structure and dynamics of gross profit, sales profit, net profit, and also identify the factors shaping the final financial result. By summarizing the results of the analysis, it is possible to identify untapped opportunities to increase the organization’s profits and increase its level of profitability.
The information presented in the profit and loss statement allows all interested users to draw a conclusion about how effective the activities of a given organization are and how justified and profitable investments in its assets are.
In world practice, several options for constructing a profit and loss statement are used.
In this case, the following classification grounds can be distinguished:
Approach to cost classification:
- location of indicators;
- the method of obtaining financial results;
- the method of disclosing the difference between income and expenses.
Depending on the approach to cost classification, cost and cost formats are distinguished. IN international standards financial statements use different terminology.
IFRS 1 Presentation of Financial Statements provides two alternative options for classifying operating and other costs: by nature of cost (natural format) and by purpose (functional format).
In the natural format (cost format), costs are classified as follows:
Materials;
- wage costs;
- depreciation charges, etc.
An important difference between the cost and cost formats is the reflection in the natural format of changes in inventories of finished goods and work in progress.
The functional diagram of cost distribution involves grouping costs into classes in accordance with their function, for example: cost of sales: selling expenses; administrative expenses, etc.
Companies using a functional expense classification scheme must disclose Additional information on the nature of expenses, including depreciation and labor costs.
In practice, profit and loss statements of most companies are a combination of natural and functional schemes:
1. Based on the location of the indicators, we can distinguish sequential, parallel and matrix forms of the profit and loss statement.
In a parallel form, expenses are recorded on the left, income on the right (or vice versa), and the financial result is reflected on the side where the excess is achieved.
In a sequential form, entries are recorded from top to bottom: income, expenses (or vice versa), financial result.
In a matrix (chessboard) form, the rows reflect expenses, the columns - income (or vice versa).
2. According to the method of obtaining the financial result, profit and loss report formats are distinguished, compiled in one-step and multi-step methods.
With the multi-step method, intermediate financial results are calculated.
3. According to the method of disclosing the difference between income and expenses, full and balanced formats of the profit and loss statement are distinguished. The choice of one of the formats depends on the priority of clarity or information content.
All amounts of income and expenses are shown in full format. In the balanced format, income is the difference between income and expenses. The income statement can reflect either turnover (gross method) or balance (net method) of the resulting accounts. The gross report provides more information and more fully reveals the structure of income and expenses. In this case, a more clear distinction is made between the report and the balance sheet: the report records the turnover, the balance sheet records the balance. The net report contains less information, but presents it in a more convenient form.
The profit and loss report, presented as part of the reporting forms approved by Order of the Ministry of Finance of the Russian Federation “On Forms of Accounting Reports of Organizations” No. 66n, is compiled according to the cost format, in a multi-step method, using the gross method with a vertical arrangement of indicators.
The basis for constructing a profit and loss statement in the Russian Federation is the classification of income and expenses established by Accounting Regulations 9/99 “Income of the organization” and 10/99 “Expenses of the organization”.
For purposes accounting and disclosures in reporting, income is divided into income from common species activities and other income, and expenses, respectively, for expenses for ordinary activities and other expenses. The organization makes this distinction independently based on the nature of its activities, the type of income and expenses and the conditions for receiving them. TO ordinary activities, as a rule, refer to the type of activity specified in the charter and constituent documents. During registration legal entity In territorial statistics bodies, such types of organization activities are assigned a type code economic activity(OKVED).
In addition, ordinary activities include receipts that are significant in the total amount of income and are of a regular nature.
In the profit and loss statement, income is divided into revenue and other income (clause 18 of PBU 9/99 “Income of the organization”).
Other income and other expenses related to them may be reflected in the report in a collapsed manner, but subject to two conditions:
They are not essential characteristics of the activity;
- such reflection is permitted by the accounting rules (clause 18.2 PBU 9/99 “Income of the organization” and clause 21.2 PBU 10/99 “Expenses of the organization”).
Expenses are subject to recognition in accounting, regardless of the intention to receive revenue, other and other income (clause 17 of PBU 10/99 “Expenses of the organization”).
In the profit and loss statement, expenses are divided into the cost of goods sold, products, works, services, commercial, administrative expenses and other expenses (clause 21 of PBU 10/99 “Organizational expenses”).
ANALYSIS OF PROFIT AND LOSS STATEMENT
The profit and loss statement (form No. 2) is one of the main forms of accounting reporting. The profit and loss statement characterizes the financial results of the organization for the reporting period.
Form No. 2 reflects the following indicators:
The amount of balance sheet profit or loss from sales of products;
- operating income and expenses;
- income and expenses from other non-operating activities;
- enterprise costs for production;
- commercial and administrative expenses;
- amount of income tax;
- net profit.
The profit and loss statement is the most important source for analyzing the profitability of an enterprise, the profitability of product production and determining the amount of net profit.
The income statement must contain, at a minimum, the following line items:
Revenue;
- financing costs;
- share of profits and losses of associated companies, according to joint activities accounted for using the participation method;
- profit or loss before tax;
- tax expenses;
- net profit or loss;
- results of emergency circumstances;
- profit or loss of minority interest;
- profit or loss of the owners of the parent company.
Cost Analysis
Companies develop their profit and loss statements independently. The format of this report primarily depends on the chosen order of expense analysis. IFRS stipulates that expenses should be allocated to subclasses. The analysis can be carried out using one of two options - the method of the nature of expenses or the method of function of expenses.
Cost-by-nature analysis is typically used in small companies where there is no need to allocate operating expenses by function. This format contains the article "Changes in Inventory and Work in Process". It represents the difference between their estimated quantity at the beginning and end of the period. It is taken into account with a minus sign if the value of the balances decreases, and with a plus sign if the value of the balances increases. Analyzing expenses by function can provide more meaningful information, but is more subjective than the previous method. Let us give an example of the comparability of the two approaches.
The company can choose any analysis of expenses when preparing the income statement and the format of the report accordingly.
PROFIT AND LOSS STATEMENT INDICATORS
The main purpose of the Profit and Loss Statement (Form No. 2) is to characterize the indicators of the financial performance of the organization for the reporting period, such as:
Gross profit;
- profit (loss) from sales;
- profit (loss) before taxation;
- net profit (loss) of the reporting period.
The notes to the balance sheet and income statement disclose information relevant to the entity's accounting policies, providing users with additional data that is not appropriate to include in the balance sheet and income statement, but which they need to realistically assess the financial position of the entity, financial the results of its activities.
The essence of profit
According to K. Marx, profit is a transformed form of surplus value. Why does K. Marx call it not just a form, but precisely a transformed form of surplus value? In this regard, two circumstances should be noted. One follows from the fact that, as noted above, the source of surplus value is directly variable capital v. However, hidden in capitalist production costs is the division of capital into constant and variable, since from the point of view of the needs of economic practice, it is important for an entrepreneur to have a completely different division of his capital - into fixed and circulating capital. Hence it seems to him that the profit he received is the product not only of variable capital, but of the entire advanced capital K.Thus, the transformed nature of profit lies, first of all, in the fact that, from the point of view of a businessman, it appears as a result of the functioning of all advanced capital, although its direct source is material basis(surplus value) is variable capital, because surplus value is the materialization of surplus labor. At the same time, it is also true that profit is the product of all advanced capital, since variable capital, as a direct source of surplus value, cannot create it without constant capital.
The second circumstance is that, as a rule, the profit received by the entrepreneur is quantitatively different from the surplus value produced by his employees. This is due to the fact that profit is not just produced, but also realized by surplus value. In other words, the amount of profit depends both on the conditions of production (which determine the amount of surplus value) and on the conditions for the sale of goods, i.e., first of all, on the ratio of supply and demand for them (which does not directly affect the volume of surplus value).
For example, if the cost of a product is equal to k + t, and the selling price turns out to be higher than this value due to excess demand for this product above its supply, then profit P will be greater than the surplus value m. When the price of a commodity falls below its value k + m due to the establishment of demand for the corresponding product below its supply, then profit P will be less than the surplus value m contained in it. Thus, profit , as well as the price of a product, are directly determined in their magnitude (as opposed to the surplus value and value of the product) by the conditions prevailing in the market, where supply and demand rarely coincide.
Profit calculation
Types of costs
Formulas
Profit calculation is the process of determining the amount that remains with the enterprise after deducting certain expenses from the income received. After all, the mere presence of revenue does not mean that the company is doing well.
Types of costs
Before calculating profits, you need to decide on the types of costs. They can be divided into variables and constants.
Variable costs- these are the expenses on which the cost of production depends. Their amount is directly related to the volume of production. These are raw materials, piecework wages for workers, some taxes, etc.
Fixed costs do not depend (or depend little) on production volumes. These are rental payments, payment utilities, employee salaries on the salary system, taxation, etc.
We can separately mention operating expenses (related to the process of processing raw materials into the finished product) and commercial expenses (related to sales - advertising, packaging, delivery, commissions of sales agents, etc.).
It is not always possible to draw a clear line between these types.
The formula used to calculate profit depends on exactly what value needs to be calculated. But in general it is revenue minus costs. The result can be either positive or negative (if the company suffers losses).
For example, profit (P) could be:
Gross (net income on invested capital): Pval. = Revenue – Variable costs
net (the amount remaining after deducting all expenses from total income): Pchist. = Revenue – Variable and Fixed salaries – Other salaries and taxes
real (taking into account inflation, when nominal rates of return are correlated with the consumer price index)
before tax (same as net, only without deduction of taxes), etc.
Thus, the method by which profit is calculated is selected depending on what indicators need to be analyzed.
Revenue from sales
Profit is an important indicator that characterizes the result of a company’s activities. The goal of any activity is to obtain greater profits at minimal costs. The main indicator of business performance is profit from sales, which is reflected in the accounting and statistical reporting.The profitability of the company, its cash flow, and asset turnover depend on the size of revenue and profit from sales of products. Every entrepreneur is looking for ways to obtain maximum profit, and for this you need to know everything about it: formation, calculation and influencing factors.
What does profit show?
Sales profit is an indicator that evaluates the functioning and efficiency of a company. The level of profit must be sufficient to carry out normal activities.
Performance can be assessed by comparing the profit of the reporting period with the indicators of previous periods. If profits increased, then the company worked efficiently.
The sales profit indicator is calculated by the difference between gross income and costs of selling goods.
The form for calculating profit from sales is as follows:
Sales profit = Gross profit – Costs of selling goods – Administrative expenses.
Gross profit is calculated as the difference between sales revenue and cost of sales.
Factors influencing performance
To find reserves for profit growth, it is necessary to determine on what components it depends. Its size is influenced by internal and external factors.
The amount of profit from sales is influenced by the following internal factors:
Trade revenue;
cost of goods;
volume of sales;
cost of goods sold;
costs of selling products;
administrative expenses.
Increasing sales of profitable products leads to greater profits, which leads to financial growth for the company. Sales of unprofitable goods affect profit in the direction of its reduction.
Profit also increases with an increase in the share of profitable goods in the structure of the assortment of goods sold; if the assortment sold is dominated by products with low profitability, then profit decreases.
Reducing the cost of goods sold allows you to increase profits, and increasing costs leads to a decrease in profits. The expenses that are most susceptible to this dependence include selling and administrative costs.
Changes in product prices also affect sales. An increase in prices leads to an increase in profits, otherwise - to a decrease.
Businessmen have the opportunity to influence all these factors and change them depending on the need. Factor analysis allows you to identify reserves of sales efficiency and make optimal management decisions. To carry out such an analysis, it is involved financial statements"Profit and loss report" of the enterprise.
The company has no influence on external factors that depend on the state of the market where sales are carried out.
These factors include:
Deductions for depreciation;
cost of raw materials for production;
market conditions;
natural and climatic conditions acting as force majeure circumstances;
state policy in the field of taxes, fines, interest rates.
These factors do not have a direct impact on profit, but they can depend on the cost of goods and the volume of their sales.
Calculation of profit from sales
When planning the work of the company, it is necessary to take into account the expected profit from product sales.
The easiest way to calculate planning is using profitability. This method takes into account the results of past periods, which are taken from accounting reports and based on them the expected profit is calculated.
Profit from sales = Product volume x Expected cost x Profitability of the previous period.
For a more complete and reliable forecast, various analytical and financial programs are offered today that take into account all the main factors. To obtain maximum information, you need to take a larger period of time of the enterprise’s production activities and take into account more data. Such calculations take into account modern economic indicators: inflation, changes in legislation, market conditions.
Calculation of profitability in an enterprise is important element in business management. Any manager can do this operation, and it will not take much time, but the result will be obvious - profits will increase and the company’s performance will improve.
Product profit
Profit from sales of products is defined as the difference between revenue from sales of products without value added tax and excise taxes and production and sales costs included in the cost of production.From the above definition it follows that its origin is associated with the receipt of gross income by an enterprise from the sale of its products (works, services) at prices determined on the basis of supply and demand. The gross income of an enterprise - revenue from the sale of products (works, services) minus material costs - is a form of net production of the enterprise, includes wages and profit.
The workforce is interested in both increasing wages and increasing profits, since the latter, in a competitive environment, is a source of not only survival, but also expansion of production, and, consequently, growth in the well-being of enterprise employees and their standard of living. It also follows from this that the mass of profit and gross income characterizes nothing more than the size of the effect obtained as a result of the production and economic activities of the enterprise.
In conditions market relations an enterprise should strive, if not to obtain maximum profit, then at least to the amount of profit that would allow it not only to firmly maintain its position in the market for the sale of its goods and services, but also to ensure the dynamic development of its production in a competitive environment . Ultimately, this involves knowing the sources of profit and finding ways to best use them.
In market conditions, as world practice shows, there are three main sources of profit:
The first source is formed due to the monopoly position of the enterprise in the production of a particular product and/or the uniqueness of the product. Maintaining this source at a relatively high level involves constantly updating the product. Here it is necessary to take into account such countervailing forces as the antimonopoly policy of the state and growing competition from other enterprises;
the second source is directly related to production and business activities. It practically applies to all enterprises. The effectiveness of its use depends on knowledge of market conditions and the ability to adapt production development to this constantly changing situation. It all comes down to doing the appropriate marketing. The amount of profit in this case depends, firstly, on the correct choice of the production direction of the enterprise for production (choice of products that are in stable and high demand); secondly, from creating competitive conditions for the sale of their goods and provision of services (price, delivery time, customer service; after-sales service, etc.); thirdly, on production volumes (the larger the production volume, the greater the amount of profit); fourthly, from the structure of reducing production costs;
the third source stems from the innovative activities of the enterprise. Its use presupposes the constant updating of manufactured products, ensuring their competitiveness, increasing sales volumes and increasing the amount of profit.
The final financial result of the economic activity of an enterprise is balance sheet profit. Balance sheet profit is the sum of profits (losses) of an enterprise both from the sale of products and income (losses) not related to its production and sale. The sale of products means not only the sale of manufactured goods that have a natural material form, but also the performance of work and the provision of services. Balance sheet profit as the final financial result is determined on the basis of accounting of all business transactions of the enterprise and evaluation of balance sheet items. The use of the term “balance sheet profit” is due to the fact that the final financial result of the enterprise is reflected in its balance sheet, compiled at the end of the quarter or year.
Balance sheet profit includes three consolidated elements: profit (loss) from sales of products, performance of work, provision of services; profit (loss) from the sale of fixed assets, their other disposal, sale of other property of the enterprise; financial results from non-operating operations.
Profit from the sale of products (works, services) characterizes the net income generated by the enterprise. The remaining elements of balance sheet profit reflect mainly the redistribution of previously created income.
Let us consider in detail all the components of balance sheet profit. Profit (loss) from the sale of products (works, services) is the financial result obtained from the main activities of the enterprise, which can be carried out in any form specified in its charter and not prohibited by law. The financial result is determined separately for each type of activity of the enterprise related to the sale of products, performance of work, and provision of services. It is equal to the difference between the proceeds from the sale of products (works, services) in current prices and the costs of its production and sale.
Revenue is taken into account without value added tax and excise taxes, which, being indirect taxes, go to the budget. The amount of markups (discounts) received by trade and supply and marketing enterprises involved in the sale of products is also excluded from revenue. Enterprises exporting products also exclude export tariffs, which are allocated to state revenue. At the same time, cash receipts associated with the disposal of fixed assets, tangible (current) and intangible assets, the sale value of foreign currency assets, valuable papers are not included in revenue.
The composition of costs for the production and sale of products (works, services) included in the cost price is regulated by law. The costs that form the cost are grouped into the following elements: material costs, labor costs, social contributions, depreciation of fixed assets, etc.
For the sale of products that have a natural-material form, profit is calculated based on revenue and full cost products determined by the volume of products sold. IN in kind it includes leftovers finished products at the beginning of the reporting period, not sold in the previous period, and the output of marketable products of the reporting period minus that part of the products that cannot be sold at the end of the reporting period. A period means a quarter or a year. The composition of the balances of unsold products at the beginning and end of the period depends on the method of revenue accounting chosen by the enterprise - upon receipt of money in the current account (cash) of the enterprise or upon shipment of products, the payment documents for which are presented to the buyer.
Profit from the performance of work and provision of services is calculated similarly to profit from the sale of products. The generation of revenue is closely related to the characteristics of the work and services performed and the forms of payment used.
For example, in construction organizations Revenue reflects the cost of completed construction projects or work performed under contract and subcontract agreements. It is determined by documents that are the basis for settlements between customers and contractors (subcontractors). To determine profit, the actual cost of completed work is used. In trade, supply and distribution enterprises, revenue corresponds to gross income from the sale of goods (the amount of markups or discounts as a percentage of the cost of goods sold). Gross income is calculated as the difference between the sale and purchase price goods sold. To determine profit, the distribution costs of trading, supply, and sales organizations are excluded from it. At transport and communications enterprises, revenue reflects funds for the services provided at current tariffs. The cost value is an indicator of the operating costs of transport (communications) enterprises, taking into account the costs of forwarding and loading and unloading operations.
Profit (loss) from the sale of fixed assets, their other disposal, sale of other property of the enterprise is a financial result not related to the main activities of the enterprise. It reflects profits (losses) on other sales, which include sales to third parties various types property listed on the balance sheet of the enterprise.
The enterprise independently manages its property. It has the right to write off, sell, liquidate, transfer buildings, structures, equipment to the authorized capital of other enterprises, vehicles and other fixed assets, material values, obtained in the process of demolition and dismantling of buildings and structures, to sell individual objects, inventory items and other types of property. The financial result occurs only upon the sale of the listed types of property, as well as upon other disposal of under-depreciated objects in some cases. When selling fixed assets, the financial result is determined as the difference between the selling price of fixed assets sold externally and their residual value, taking into account the costs incurred for the sale.
Other assets of the enterprise include raw materials, materials, fuel, spare parts, intangible assets (patents, licenses, trademarks, computer software products, etc.), currency values (foreign currency, securities in foreign currency, precious metals and natural precious stones, with the exception of jewelry and household products and scrap of such products), securities. The difference between the selling price of these types of enterprise property and their book value (including expenses incurred in connection with this) constitutes a financial result that affects the amount of book profit.
Financial results from non-sales operations are profit (loss) from operations of various natures that are not related to the main activities of the enterprise and are not related to the sale of products, fixed assets, other property of the enterprise, the performance of work, or the provision of services. Financial result is defined as income (loss) minus expenses for non-operating operations.
The list of non-operating profits (losses) of an enterprise is heterogeneous and quite extensive. Significant specific gravity may consist of income from long-term and short-term financial investments and income from leasing property (they are taken into account as part of non-operating profits if leasing property is not the main activity of the enterprise).
Financial investments mean the placement of an enterprise's own funds in the activities of other enterprises, which makes it possible to obtain income. Long-term financial investments are understood as the costs of an enterprise for investing funds in the authorized capital of other enterprises (partnerships, joint stock companies, joint ventures, subsidiaries), acquiring shares and other securities, and providing funds on loan for a period of more than a year. Forms of short-term financial investments include the purchase of short-term treasury bills, bonds and other securities, and the provision of loans for a period of less than a year. Cash or other property assets of participants in a joint activity agreement without forming a legal entity for this purpose are also considered financial investments - long-term or short-term depending on the duration of the agreement, therefore income from them is also included in non-operating income.
Income from equity participation in the authorized capital of another enterprise represents part of its net profit, which goes to the founder in a pre-agreed amount or in the form of dividends on shares owned by the founder. Income from securities includes interest on bonds, short-term treasury bills, and dividends on stocks. An enterprise has the right to receive income from securities of joint-stock companies if they were acquired no later than 30 days before the officially announced date of their payment. For government securities, the right and procedure for receiving income are determined by the conditions of their issue and placement. From the funds lent, the enterprise receives income under the terms of the agreement between the lender and the loan borrower.
Non-operating profits (losses) also include the balance of received and paid fines, penalties, penalties and other types of sanctions (except for sanctions paid to the budget and a number of extra-budgetary funds in accordance with the law); other income and expenses (losses, losses).
Such income includes:
Profit of previous years, identified in the reporting year (for example, amounts received from suppliers for recalculations for services and material assets received and spent last year; amounts received from buyers, customers for recalculations for products sold last year, etc.) ;
- income from additional valuation of goods;
- receipt of amounts to repay accounts receivable written off at a loss in previous years;
- positive exchange rate differences on foreign currency accounts and transactions in foreign currency;
- interest received on funds in the accounts of the enterprise.
Costs and losses include:
Losses on operations of previous years, identified in the reporting year, from markdowns of goods, write-off of bad receivables;
- shortages of material assets identified during inventory;
- costs for canceled production orders and for production that did not produce products, excluding losses reimbursed by customers (in this case, the cost of the material assets used is deducted);
- negative exchange rate differences on foreign currency accounts and transactions in foreign currency;
- uncompensated losses from natural disasters, taking into account the costs of preventing or eliminating the consequences of natural disasters (this excludes the cost of scrap metal, fuel, and other materials received);
- uncompensated losses as a result of fires, accidents, and other emergency events caused by extreme situations;
- costs of maintaining preserved production capacity and facilities, with the exception of costs reimbursed from other sources;
- legal costs and arbitration fees, etc.
When considering profit as the final financial result of business activity, it should be borne in mind that not all profit received remains with the enterprise, as it is subject to taxation.
Taxable profit is reduced by the amount of profit from the sale of agricultural and hunting products, as well as from the sale of agricultural products produced and processed at this enterprise own production.
Taxable profit for actual costs and expenses incurred at the expense of profits remaining at the disposal of the enterprise is also reduced by amounts allocated:
A) enterprises in the sphere of material production to finance capital investments for production purposes (including through equity participation), as well as to repay bank loans received and used for these purposes, including interest on loans;
b) enterprises of all sectors of the national economy to finance housing construction (including through equity participation), as well as to repay bank loans received and used for these purposes, including interest on loans. This benefit is provided to the specified enterprises developing their own production base and housing construction;
In order to stimulate scientific and technical progress, taxable profit is reduced by amounts allocated:
Scientific organizations that have passed state accreditation, directly for the conduct and development of research and development work in the manner and according to the list established by the Government of the Russian Federation;
enterprises for R&D, as well as Russian Foundation technological development, but not more than 10% of the amount of taxable profit.
The portion remaining after taxes is residual profit (or net profit), which is completely at the disposal of the enterprise. It is used for wages and material incentives, for the increase in working capital, capital investments, and social development through the formation of appropriate funds: the development of science and technology, social development, and material incentives.
Thus, in the conditions of the transition to the market and in its further formation, profit is the main incentive for organizing production and economic commercial activities enterprises.
Receiving a profit
Making a profit is the main goal, by definition, of any commercial activity. In an economic sense, the profit an entrepreneur receives directly depends on the risk. The higher the business risk, the higher the profit.Profit is influenced not only by financial factors (cost of raw materials or production efficiency), but also by market ones. For example, a company can make more profit if it has a monopolist in the market and can dictate its (inflated) prices for products to customers.
Profit Analysis
A general analysis of profit can be performed according to the financial statements - the Profit and Loss Statement (for example, automatically, using a special program). In particular, changes in profit are analyzed (dynamic analysis), as well as profitability ratios. To analyze profit, two types of coefficients are used. In the first, profit is compared with another “working” indicator - revenue or cost (for example, return on sales). In the second, profit is calculated in relation to the value of assets or capital involved in its creation (for example, return on assets, return on equity).
For a more in-depth analysis of the factors that influenced the financial result, both accounting data (including cost data by items and elements) and external data (for example, a drop in demand, a deterioration in the economic situation in the country) are used.
Taxation of profits
Along with added value, which is subject to VAT, the main object of taxation for commercial organizations is profit. At the same time, income tax is a direct tax, it is paid by the enterprise from its own funds, while VAT is an indirect tax, it is paid at the expense of the buyer.
Currently, the income tax rate in the Russian Federation is 20% (with a higher tax rate for some types of activities). There are also special tax regimes (for example, a simplified taxation system), where profits (income minus certain expenses) are taxed at a lower rate.
Profit is the difference between revenue (income) and costs (expense). Profit is the key measure financial efficiency entrepreneurial activity.
The financial statements (Profit and Loss Statement) highlight the following profit indicators:
Gross profit (loss) – the difference between revenue excluding VAT and cost of sales;
profit (loss) from sales – gross profit minus commercial and administrative expenses;
profit (loss) before tax (profit (loss) from sales plus interest and other income and expenses, except income tax);
net profit (loss) – the final financial result taking into account all income and expenses of the organization.
Profit Analysis
Profit analysis is divided into various directions, types and forms depending on the following characteristics:The areas of research include analysis of profit generation and analysis of its use:
Analysis of profit generation is carried out in the context of the main areas of activity - operating, investment, financial. It is the main form of analysis for identifying reserves for increasing the amount and level of profit. One of its aspects is the analysis of profit according to accounting data and taxable profit;
analysis of the distribution and use of profit is carried out in the main areas of its use. It is designed to identify the level of consumption of profit and its capitalization, as well as specific forms of its production consumption for investment purposes.
According to the organization of the implementation, internal and external profit analysis are distinguished:
Internal analysis is carried out by managers or owners of the enterprise using the entire range of available information. The results of such analysis may constitute a trade secret;
external analysis is carried out by tax authorities, banks, insurance companies based on materials published by the enterprise in the open press.
Based on the scale of activity, the following forms of profit analysis can be distinguished:
Analysis of profits for the enterprise as a whole. In the process of this analysis, the formation, distribution and use of profit is studied without identifying individual structural divisions of the enterprise (used in financial analysis);
profit analysis by structural unit or responsibility center (used in management accounting);
profit analysis for individual products (is additional view analysis, which can be used in both financial and management accounting).
According to the scope of the study, a complete and thematic analysis of profit is distinguished:
A full analysis is carried out to study all aspects of its formation, distribution and use in a complex;
thematic analysis is limited to certain aspects of the formation or use of profit (the impact of the tax policy pursued by an enterprise on the formation of costs, income and profit;
the influence of the structure on the level of profitability of the enterprise, etc.).
According to the period and depth of implementation, they distinguish the following types profit analysis:
Preliminary analysis of profit (express profit analysis, forecast analysis) related to the conditions of its formation, distribution or future use, with the conditions for carrying out individual commercial transactions, financial or investment transactions, when drawing up a business plan, analysis of final accounting statements in order to determine the amount and profit margins, return on sales and assets of the enterprise;
operational analysis of profit, carried out in the process of carrying out production, investment and financial activities with the aim of promptly influencing the formation or use of profit;
subsequent (in-depth) analysis of profit, carried out based on the results of work for the reporting period for the most complete study of financial results in comparison with the preliminary and current analysis, identification of factors that influenced changes in profit in comparison with the business plan, indicators of the implemented investment project or the previous period, as well as for monitoring and subsequent adjustment of the indicators of the business plan being implemented by the enterprise;
detailed analysis of profit, carried out in the context of studying each of the factors influencing the amount of profit for the enterprise as a whole, profit for certain species manufactured products or specific sales.
The purpose of enterprise profit analysis
The purpose of profit analysis is to find out the reasons behind the change in profit, determine the reserves for its growth and prepare management decisions to mobilize the identified reserves.
To achieve this goal, the following tasks are solved during the analysis:
1. assessment of the implementation of the plan (forecast) and the dynamics of financial results;
2. study of the composition and structure of profit;
3. identification and quantitative change in the influence of profit formation factors;
4. analysis and assessment of profit quality;
5. study of directions, proportions and trends in the distribution of profits;
6. identifying reserves for profit growth;
7. development of recommendations for the most effective use of profits, taking into account the prospects for the development of the enterprise.
Profit Management Process
The profit management process includes the implementation of a number of functions, such as planning final financial results, accounting for the formation, distribution and use of profit, assessment and analysis of the achieved level, and making management decisions. Thus, the results of the analysis are used to make decisions in the field of earnings management. During the analysis, several decision-making options are developed, on the basis of which a decision is made that is optimal for the enterprise in a given situation.
When analyzing profits for various calendar years it is necessary to carry out calculations in comparable prices - in prices of the previous or reporting periods.
During the analysis, various techniques and methods of analysis are used to obtain a quantitative assessment of financial results. These include horizontal and vertical analysis, comparative analysis and analysis by factors, analysis of profitability ratios and risk analysis, integral analysis, etc.
Profit goal
Any business starts with the goal of making a profit, because... this is essential to the survival and growth of the company. From the point of view of economic theory, generation cash flows(i.e. making a profit) should be considered as the main goal of any business unit.The need for profit is determined by the need to cover production costs, as well as expansion and development of the enterprise. It will simply be impossible for a business to survive without profit.
Some economists believe that profit maximization should not be the dominant goal in a company's development strategy, because this leads to unnecessary exploitation not only work force, but also consumers. Other theorists, on the contrary, argue that profit should be main goal the company, since it is the entrepreneur’s monetary reward for the risks taken and, accordingly, a motivating factor for further growth and development.
IN Lately Among the largest businessmen there has been a tendency to adhere to the view that business should, first of all, be socially responsible. Improving the quality of life of people, society as a whole, environment, participation in solving pressing social problems - this is a list of tasks facing a socially responsible business.
One of richest people British businessman and bestselling author of Losing My Virginity, Sir Richard Branson, believes that at the heart of any enterprise there should be a fundamental idea of benefiting others, and profit will take care of itself.
IN modern world Success is achieved by those companies that not only offer the market a high-quality product or service, but demonstrate to potential consumers a sincere social responsibility.
However, profit is important to business for a number of reasons:
1. Profit is necessary for the growth of the company. Profit acts as the main source of financing the activities of the enterprise (purchases of raw materials, supplies, equipment, salary payments).
2. Profit is necessary for the survival of the company. In order to cover production and other expenses, the company must have a source of income. This becomes especially critical during economic downturns.
3. Profit is necessary to satisfy the individual and social needs of the entrepreneur.
4. Profit is the most important economic indicator of business success. The enterprise profitability indicator acts as a litmus test for assessing the prospects, attractiveness and rationality of the functioning of a business unit. This valuation indicator becomes especially important for analysts when a company enters an IPO. stock market, traders, investors.
Opponents of profit maximization cite the following facts as arguments:
1. It leads to exploitation of workers and consumers. Companies, in pursuit of increasing profits, strive to reduce expenses (employee salaries) and increase revenue ( aggressive advertising, aggressive methods of promoting and selling their products, attempts to manipulate the minds of consumers).
2. This leads to increasing social inequality, with the rich getting richer and the poor getting poorer.
3. This leads to an increase in cases of corruption.
4. It reduces the morale of society and increases the degree of materialism.
Components of profit
A good way to determine the marketing goals of an advertising campaign is to identify three ways that an advertising campaign can impact profits.Profit components:
In general, Profit = (Price – Costs) Sales volume.
As we can see, there are three potential ways that advertising communications and incentives can impact a brand's profitability:
Increase the price provided that losses from a decrease in sales volumes can be avoided;
- reduce costs as much as possible;
- increase sales volumes.
Most often, companies strive to use only the third method, however, the other two sources of increasing profits are no less important. Of course, if the company's task is to maintain profits at a given level, and not to increase them, then maintaining prices, costs and sales volumes will be sufficient. Such a goal is sufficient during a period of general economic downturn or if the brand faces strong competition. But we will assume that the main goal is to increase profits, so we will briefly consider how this can be achieved with the help of an advertising company.
Time horizons
Short-term period – when the desired results need to be obtained as soon as possible.
- Medium-term (annual) – a typical period for planning an advertising campaign and drawing up an advertising budget.
- Long-term period – lasting from one year to some point in the predictable future (3,5,10,15 years).
These three planning horizons cover most of the situations that a manager faces when setting marketing goals for an advertising company.
Profit accounting
Account 99 “Profits and losses” is intended to summarize information on the formation of the final financial result of the organization’s activities in the reporting year. The debit of account 99 reflects losses (losses, expenses), and the credit reflects the profits (income) of the organization. A comparison of debit and credit turnover for the reporting period shows the final financial result.Account 99 during the reporting year reflects:
Profit or loss from ordinary activities - in correspondence with account 90;
- balance of other income and expenses for the reporting month - in correspondence with account 91;
- the amount of accrued conditional income tax expense, permanent liabilities and payments for recalculation of this tax from actual profit, as well as the amount of tax penalties due - in correspondence with account 68 “Calculations for taxes and fees”.
Accrued income tax payments and the amount of tax penalties due are recorded in the debit of account 99 and the credit of account 68 “Calculations for taxes and fees”. Payments for income tax recalculations are also reflected in these accounts.
At the end of the reporting year, when preparing annual financial statements, account 99 is closed. In this case, by the final entry in December, the amount of net profit (loss) of the reporting year is written off from account 99 to the credit (debit) of account 84 “Retained earnings (uncovered loss).”
Thus, the financial result generated on account 99 is transferred to account 84 “Retained earnings (uncovered loss)”, which records the organization’s own profit.
Analytical accounting for account 99 should ensure the generation of data necessary for drawing up a profit and loss statement.
The profit remaining at the disposal of the organization after taxes can be used to pay dividends to the founders.
Retained earnings is the amount of net profit not distributed in the form of dividends (or otherwise) between the participants of the organization in accordance with the constituent documents, and is reflected in the credit of account 84 “Retained earnings (uncovered loss).”
The loss for the reporting period is shown in the debit of account 84. The credit balance of this account is transferred to the balance sheet as profit, the debit balance as an uncovered loss.
Uncovered losses of the reporting period can be covered from reserve funds, contributions from participants (if provided for by the constituent documents). If these funds are insufficient, a debit balance is formed on account 84, which is carried over to the next year.
Executive bodies Organizations of any organizational and legal form are required to submit to their owners a report on the results of their work for each past financial year. The financial report is approved at annual meetings of joint-stock companies and companies with limited liability which are held annually. The financial report includes a balance sheet, profit and loss account, other forms of reporting, and an auditor's report. The meeting participants decide on the distribution of profits received for the year or on the sources of covering losses, and determine the amount of dividends. The decisions made at the meeting are the basis for the accounting department to make appropriate accruals and accounting entries.
In accordance with Federal law"About joint stock companies» dividend can be paid quarterly or semi-annually, once a year. The decision on the payment of an interim dividend and its amount is made by the board of directors. The amount of the annual dividend is declared general annual meeting based on the results of work for the year, taking into account the payment of interim dividends, it cannot be more than recommended by the board of directors ( supervisory board) of the company and less interim dividends paid. The General Meeting of Shareholders has the right to decide not to pay dividends on shares of certain categories (types), as well as to pay partial dividends on preferred shares, the dividend amount for which is determined in the charter.
Owners of preferred shares receive a fixed income, since the amount of the dividend is indicated at the time of issue in the prospectus. It may be provided for in the company's charter in the form of a fixed sum of money or as a percentage of the par value of preferred shares. Dividends on these shares are accrued and paid in the first place and regardless of the amount of profit received. If the profit received is not enough to pay dividends on preferred shares, then a specially created reserve and other sources are used for these purposes.
The procedure for determining the amount of dividends on ordinary shares per share involves preliminary exclusion from the total amount of profit allocated for the payment of dividends on preferred shares and dividing the result by the number of fully paid ordinary shares. At the same time, the denominator does not take into account own shares purchased from shareholders and on the balance sheet of the joint-stock company.
A joint stock company cannot pay dividends in a number of cases, including:
Until full payment of the entire authorized capital of the company;
- before the repurchase of all shares that must be repurchased in accordance with Art. 76 of the said Law;
- if on the day such a decision is made the company meets the criteria of insolvency (bankruptcy) in accordance with legal acts Russian Federation on the insolvency (bankruptcy) of enterprises or if the specified signs appear in the company as a result of the payment of dividends;
- if on the day such a decision is made the cost net assets the company is less than its authorized capital and reserve fund and the excess of the liquidation value of the placed preferred shares over the nominal value determined by the charter or will become less than their size as a result of the payment of dividends;
For accounting, not only the size of dividends and the form of payment are important, but the date of payment is no less important. The date of payment of annual dividends is determined by the company's charter or resolution general meeting shareholders on the payment of annual dividends. The date of payment of interim dividends is determined by the decision of the board of directors of the company on the payment of interim dividends, but cannot be set earlier than 30 days from the date of such a decision.
For each payment of dividends, the board of directors of the company compiles a list of persons entitled to receive dividends. The list of persons entitled to receive interim dividends must include shareholders and nominal holders of shares included in the register of shareholders of the company no later than 10 days before the date of the decision on the payment of dividends by the board of directors of the company, and the list of persons entitled to receipt of annual dividends - shareholders and nominal holders of shares included in the register of shareholders of the company on the day of compiling the list of persons entitled to participate in the annual general meeting of shareholders. Thus, the accrual of dividends in a joint stock company occurs on the basis of the decision of the meeting of shareholders, the decision of the board of directors according to the list submitted by it.
The dividend is declared in full, including the amount of tax. At the end of the year, the final dividend is accepted as the sum of interim dividends.
A limited liability company (LLC) has the right to make a decision quarterly, once every six months or once a year on the distribution of net profit among the company's participants. The decision to determine the part of the company's profit to be distributed is made by the general meeting of participants.
The portion of LLC profits intended for distribution among its participants is distributed in proportion to their shares in the authorized capital.
The charter, adopted unanimously by all participants of the company, may establish a different procedure for the distribution of profits. It should be noted that changes and exclusions of provisions of the LLC charter that establish a different procedure are carried out by decision of the general meeting of participants, adopted unanimously.
Just like in a JSC, an LLC has restrictions on the distribution of profits between participants. These restrictions are similar to those adopted for JSC.
To account for settlements with shareholders or participants of companies regarding income, subaccount 2 “Settlements for payment of income” of account 75 “Settlements with founders” is used. The subaccount is passive, the credit balance shows the amount of debt the company owes to shareholders and participants; The credit reflects the accrual of debt on dividends, and the debit reflects its repayment.
If there is insufficient profit, funds from other sources can be attracted, in particular additional capital: an entry in the debit of account 83 and the credit of account 75-2.
The announcement of dividends in an amount in which there is not enough profit and other sources to pay them forces the joint-stock company to use reserve capital funds. Otherwise, it must declare itself bankrupt: an entry in the debit of account 82 and the credit of account 75-2. This option for repaying dividend obligations must be provided for by the company's charter.
Dividends receivable under a share agreement when an enterprise has financial investments in securities of other organizations, interest-bearing bonds of state and local loans, etc., are reflected in accounting as the debit of account 76 and the credit of account 91. Similar amounts receivable from subsidiaries or dependent companies are taken into account in account 76.
The organization has the right to decide on the allocation of dividends due to it for the development of the production base of these companies, increasing their authorized capital: entry in the debit of account 58 and the credit of account 76.
If the shareholders are employees of the organization, then dividends are accrued by the accounting entry in the debit of account 75-2 and the credit of account 70. Payment of dividends to their employees is reflected in the debit of account 70 and the credit of account 50.
Dividends to third-party investors are paid non-cash, which is reflected in the debit of account 75-2 and the credit of account 51 or 52. The resulting exchange rate difference, if the payment of dividends is made in foreign currency, is written off to the financial results of the investor.
Profit figures
The main profit indicators are:Total profit (loss) of the reporting period - balance sheet profit (loss);
- profit (loss) from sales of products (works, services);
- profit from financial activities;
- profit (loss) from other non-operating operations;
- taxable profit;
- net profit.
Balance sheet profit (loss) is the amount of profit (loss) from sales of products, financial activities and income from other non-operating operations, reduced by the amount of expenses for these operations.
Profit (loss) from the sale of products (works, services) is defined as the difference between the proceeds from the sale of products in current prices without VAT, special tax and excise taxes and the costs of its production and sale.
Profit (loss) from financial activities and from other non-operating transactions is determined as the difference between the total amount received and paid:
Fines, penalties and penalties and other economic sanctions;
- interest received on the amounts of funds listed on the accounts of the enterprise;
- exchange rate differences on foreign currency accounts and transactions in foreign currency;
- profits and losses of previous years identified in the reporting year;
- losses from natural disasters;
- losses from writing off debts and receivables;
- receipts of debts previously written off as bad;
- other income, losses and expenses attributed in accordance with current legislation to the profit and loss account. At the same time, amounts contributed to the budget in the form of sanctions in accordance with the legislation of the Russian Federation are not included in expenses from non-operating operations, but are included in the reduction of net profit, i.e. profit remaining at the disposal of the enterprise after paying income tax.
Taxable profit is determined by a special calculation. It is equal to book profit reduced by the amount:
Contributions to reserve and other similar funds, the creation of which is provided for by law (until the size of these funds reaches no more than 25% authorized capital, but not more than 50% of profit subject to taxation);
- rent payments to the budget;
- income from securities and from equity participation in the activities of other enterprises;
- income from casinos, video salons, etc.;
- profits from insurance activities;
- profits from individual banking operations and transactions;
- exchange rate differences resulting from changes in the ruble exchange rate in relation to quoted Central Bank Russian Federation foreign currencies;
- profits from the production and sale of industrial agricultural and hunting products.
The net profit of the enterprise, i.e. the profit remaining at his disposal is determined as the difference between book profit and the amount of income taxes, rent payments, export and import taxes.
Net profit goes to industrial development, social development, material incentives for employees, creation of a reserve fund, payment to the budget of economic sanctions related to the enterprise’s violation of current legislation, for charitable and other purposes.
An integral feature of a market economy is the emergence of consolidated profits. Consolidated profit is the profit summarized from the financial statements of the activities and financial results of parent and subsidiary enterprises. Consolidated financial statements are a combination of statements of two or more business entities that are in certain legal and financial-economic relationships. The need for consolidation is determined by economic feasibility. Entrepreneurs benefit from one large company create several smaller enterprises, legally independent, but economically interconnected, because in this case, savings on tax payments can be obtained. In addition, due to fragmentation and limitation legal liability obligations, the degree of risk in doing business is reduced, greater mobility is achieved in the development of new forms of capital investment and sales markets.
Profit from the sale of products (goods, works, services) is the difference between the proceeds from the sale of products without VAT, special tax, excise taxes, export tariffs, and the costs of production and sales included in the cost of production.
Revenue from the sale of products is determined either as it is paid for or as goods (products, works, services) are shipped and payment documents are presented to the buyer. The method for determining revenue from sales of products is established by the enterprise for a long period based on business conditions and conclusion of contracts. In industries in the sphere of commodity circulation (trade, public catering), instead of the category “revenue from sales of products,” the category “commodity turnover” is used. The essence of trade turnover is economic relations related to the exchange of cash income for goods in the order of purchase and sale. In foreign practice, instead of the term “revenue”, the term “gross income” is often used. However, this is a very broad interpretation of this term. Gross income as economic category expresses the newly created value, or the net product of an economic entity. In the practice of planning and accounting in trade, gross income is understood as the amount of trade markups (discounts); V catering- the amount of trade markups (discounts) and markups.
The cost of production is valuation natural resources, raw materials, materials, fuel, energy, fixed assets, labor resources used in the production process, as well as other costs for its production and sale.
Costs included in the cost price economic content are grouped by the following elements:
Material costs (minus the cost of returnable waste);
- labor costs;
- contributions for social needs;
- depreciation of fixed assets;
- other costs.
Business entities, incl. those who have received a loss and have an excess of actual expenses for remuneration of employees engaged in the main activity, as part of the cost of production (work, services) compared to the standardized value, pay a tax to the budget on the amount of excess of these expenses.
Types of profit
The following types of profit are distinguished: gross profit is the sum of profits (losses) of an enterprise both from the sale of products and income (losses) not related to its production and sale. The sale of products means not only the sale of manufactured goods that have a natural material form, but also the performance of work and the provision of services.Profit from the sale of products (works, services) is the financial result obtained from the main activity of the enterprise, determined by deducting from the total amount of revenue from the sale of products in current prices (excluding VAT and excise taxes) the costs of production and sales of products included in the cost of production .
Profit from performing work and providing services is calculated similarly to profit from sales of products, separately for all types of activities, i.e. profit (loss) of ancillary Agriculture, motor vehicles, logging and other farms on the balance sheet of the enterprise.
Profit (or losses) from the sale of fixed assets and other property is a financial result not related to the main activities of the enterprise. It reflects profits (losses) on other sales, which include the sale to third parties of various types of property listed on the balance sheet of the enterprise (buildings, structures, equipment, vehicles and other fixed assets, material assets obtained in the process of demolition and dismantling of buildings and structures , inventory and other types of property). The financial result from the sale of fixed assets is calculated as the difference between the proceeds from the sale of this property (less VAT and excise taxes) and the residual value on the balance sheet, adjusted by a coefficient corresponding to the inflation index.
Other assets of the enterprise include raw materials, materials, fuel, spare parts, intangible assets (patents, licenses, computer software products), currency values (foreign currency, precious metals, etc.), securities. The difference between the selling price of these types of property and their book value (including expenses incurred in connection with this) constitutes a financial result that affects the amount of gross profit.
Profit (or losses) from non-operating transactions, i.e. operations not related to the main activity of the enterprise and not related to the sale of products, fixed assets, other property of the enterprise, performance of work and provision of services. Financial result is defined as Income (or losses) minus expenses from non-operating operations.
The list of non-operating profits (or losses) of an enterprise is heterogeneous and quite extensive. A significant share can be income from long-term and short-term financial investments and income from leasing property. Long-term financial investments are understood as the costs of an enterprise to contribute funds to the authorized capital of other enterprises, purchase shares and other securities, and provide loans for a period of more than a year. Forms of short-term financial investments include the purchase of short-term treasury obligations, bonds and other securities, and the provision of loans for a period of less than a year.
Income from the rental of property is generated from the rent received, which the tenant pays to the landlord.
Non-operating profits (losses) also include received and paid fines, penalties, penalties and other types of sanctions (except for sanctions paid to the budget and a number of extra-budgetary funds in accordance with the law); other income and expenses (losses, losses).
Taxable profit (taxable) part of the gross profit of an enterprise, which serves as the basis for calculating the tax payable to the budget.
Taxable profit is reduced by the amount of profit from the sale of agricultural and hunting products, as well as from the sale of own-produced agricultural products produced and processed at a given enterprise.
Taxable profit, in case of actual costs and expenses incurred at the expense of the profit remaining at the disposal of the enterprise, is also reduced by amounts allocated:
A) enterprises to finance capital investments for production purposes, as well as to repay bank loans received and used for these purposes;
b) to finance housing construction (including through equity participation);
c) expenses of enterprises for the maintenance of facilities and institutions of health care, public education, culture and sports, children’s preschool institutions, children's holiday camps, housing stock.
After all of the above adjustments to gross profit, taxable profit remains, on which income tax is paid.
The result of multiplying taxable income by the income tax rate is the tax amount. Currently, according to the Tax Code of the Russian Federation, the income tax rate is 20%.
Net profit is a source of funds for expanded production, meeting the social and everyday needs of workers, their material incentives, and the formation of special funds and reserves. It is distributed throughout the enterprise independently.
Profit distribution refers to the direction of profit to the budget and by items of use in the enterprise.
As a rule, one part of the profit forms an accumulation fund, the other a consumption fund.
Part of the net profit (35%) is credited to the reserve (for unexpected payments, for example, in the event of a natural disaster).
The accumulation fund funds are spent:
For the acquisition and construction of fixed assets for production and non-production purposes;
payment of non-tariff sanctions;
partial training and retraining of personnel, etc.
The consumption fund is spent:
To provide financial assistance;
pension supplements;
bonuses not related to production results;
payment of dividends;
payment of social needs, etc.
However, not all net profit is used by the enterprise at its own discretion. Some types of fees and taxes are paid from net profit (for example, corporate property tax, fee for the right to trade, etc.); fines for non-compliance with environmental protection requirements from pollution, sanitary standards and rules and other payments.
At some enterprises and joint stock companies, net profit is distributed in the following areas:
Savings Fund;
- consumption fund;
- reserve fund;
- social sector fund;
- currency transfer fund;
- profit to be distributed among the founders (shareholders), etc.
Retained earnings are added to the authorized capital of the enterprise.
In a market economy, the importance of profit is enormous. The desire to obtain it directs commodity producers to increase production volumes and reduce production costs. Losses also play a role. They highlight mistakes and miscalculations in the direction of funds, organization of production and sales of products.
Forms of profit
There are 2 forms of profit, each of which must be taken into account by an entrepreneur when maintaining a business. I would like to draw your attention to the fact that the volume of profit, depending on its form, may differ not only in the amount of funds, but also in polarity.Forms of profit
The first form of profit is accounting profit, which takes into account all expenses and cash inflows. As income, accounting profit involves the contribution of additional funds by the entrepreneur, the use of real estate that was owned, and much more.
In this case, expenses take into account everything from payments for consumed electricity in production to wages workers.
Economic profit takes into account the personal contributions of the entrepreneur not as income, but as an expense. The real estate used, the entrepreneur’s labor contributions, and much more will also be taken into account as an expense. Given this information, you can already guess why the profit volume varies depending on the form.
To give an accurate assessment of the company's development, it is necessary to take into account economic profit indicators. If its indicator is positive, it means that the business is functioning correctly and has development potential.
However, if you observe positive economic profit values, this is not an indicator that you should not worry about the company's development. The success rates of your business can change at any time, and you must constantly maintain the functionality of your business.
Profit distribution
Profit as an economic category reflects the net income created in the sphere of material production in the process of entrepreneurial activity. The result of the combination of factors of production. Profit as an economic category reflects the net income created in the sphere of material production in the process of entrepreneurial activity. The result of the combination of production factors (labor, capital, natural resources) and the useful productive activities of economic entities is finished products, which become goods subject to their sale to the consumer.Firstly, it characterizes the economic effect obtained as a result of the enterprise’s activities. But it is impossible to evaluate all aspects of an enterprise’s activities using profit. There cannot be such a universal indicator. That is why, when analyzing the production, economic and financial activities of an enterprise, a system of indicators is used.
The meaning of profit is that it reflects the final financial result. At the same time, the amount of profit and its dynamics are influenced by factors both dependent and independent of the efforts of the enterprise.
Secondly, profit has a stimulating function. Its content is that it is both a financial result and the main element of the financial resources of the enterprise. The actual provision of the principle of self-financing is determined by the profit received. The share of net profit remaining at the disposal of the enterprise after paying taxes and other obligatory payments must be sufficient to finance the expansion of production activities, scientific, technical and social development of the enterprise, and material incentives for employees.
Thirdly, profit is one of the sources for the formation of budgets at different levels. It goes to budgets in the form of taxes and, along with other revenues, is used to finance the satisfaction of joint social needs, to ensure that the state fulfills its functions, state investment, production, scientific and technical and social programs.
In a market economy, the importance of profit is enormous. The desire to obtain it directs commodity producers to increase the volume of production of products needed by the consumer and reduce production costs. With developed competition, this achieves not only the goal of entrepreneurship, but also the satisfaction of social needs. For an entrepreneur, profit is a signal indicating where the greatest increase in value can be achieved, creating an incentive to invest in these areas. Losses also play a role. They highlight mistakes and miscalculations in the direction of funds, organization of production and sales of products.
The object of profit distribution is the enterprise's balance sheet profit. Its distribution means the direction of profit to the budget and by items of use in the enterprise. The distribution of profits is legally regulated in that part of it that goes to budgets of different levels in the form of taxes and other obligatory payments. Determining the directions for spending the profit remaining at the disposal of the enterprise, the structure of the items of its use is within the competence of the enterprise.
The principles of profit distribution can be formulated as follows:
The profit received by the enterprise as a result of production, economic and financial activities is distributed between the state and the enterprise as an economic entity;
- profit for the state goes to the relevant budgets in the form of taxes and fees, the rates of which cannot be arbitrarily changed. The composition and rates of taxes, the procedure for their calculation and contributions to the budget are established by law;
- the amount of profit of the enterprise remaining at its disposal after paying taxes should not reduce its interest in increasing production volumes and improving the results of production, economic and financial activities;
- the profit remaining at the disposal of the enterprise is primarily directed to accumulation, ensuring its further development, and only the rest for consumption.
In an enterprise, net profit is subject to distribution, that is, the profit remaining at the disposal of the enterprise after paying taxes and other obligatory payments. Sanctions are collected from it and paid to the budget and some extra-budgetary funds.
Distribution of net profit is one of the areas of intra-company planning, the importance of which is increasing in a market economy. The most important thing in the distribution of profits is the combination of budgetary, self-supporting and personal interests of workers. Based on this, economic practice and economic science are constantly searching for optimal criteria for profit distribution commercial organization taking into account the specific economic situation.
The procedure for the distribution and use of profit at the enterprise is fixed in the charter of the enterprise and is determined by the regulations, which are developed by the relevant departments economic services and approved governing body enterprises. In accordance with the charter, enterprises can draw up cost estimates financed from profits, or create special-purpose funds: accumulation funds (production development fund or production and scientific-technical development fund, social development fund) and consumption funds (material incentive fund). The cost estimate financed from profit includes costs for production development and social needs labor collective, for material incentives for employees and charitable purposes.
Costs associated with production development include the following:
For research, design, engineering and technological work;
- financing the development and mastery of new types of products and technological processes;
- costs of improving technology and organizing production;
- equipment modernization;
- costs associated with technical re-equipment and reconstruction of existing production, expansion of enterprises.
This same group of expenses includes the costs of repaying long-term bank loans and interest on them. Costs for environmental protection measures are also planned here.
Contributions of enterprises from profits as contributions of founders to the creation of the authorized capital of other enterprises, funds transferred to unions, associations, concerns of which the enterprise is part are also considered the use of profits for development.
Distribution of profits for social needs includes expenses:
For the operation of social and domestic facilities on the balance sheet of the enterprise;
- financing the construction of non-production facilities;
- organization and development of subsidiary farming;
- holding recreational, cultural and mass events.
Costs of material incentives include one-time incentives for completing particularly important production tasks, payment of bonuses for the creation, development and implementation of new equipment, costs of providing material assistance to workers and employees, one-time benefits to retiring labor veterans, pension supplements, employee compensation increase in the cost of food in canteens and buffets of the enterprise due to increased prices.
All profit remaining at the disposal of the enterprise is divided into two parts. The first increases the property of the enterprise and participates in the accumulation process. The second characterizes the share of profits used for consumption. At the same time, it is not necessary to use all the profit allocated for accumulation. The remainder of the profit not used to increase property has an important reserve value and can be used in subsequent years to cover possible losses and finance various costs.
Conclusion: the distribution and use of profits is an important economic process that ensures both the needs of entrepreneurs and the generation of income in Russia.
The profit distribution mechanism should be structured in such a way as to contribute in every possible way to increasing production efficiency and stimulating the development of new forms of management. Depending on objective conditions social production at various stages of development Russian economy the profit distribution system changed and improved.
Profit percentage
In order to earn more, it is necessary to systematize the process of obtaining this very money. It is important to be clear about the numbers you get as a result of setting up your business. Calculating the profit percentage is not that difficult. You just need to carefully read the instructions described below and choose the method that is most suitable for you.Divide the trade markup as a percentage by the sum of the number one hundred with the value that is equal to the dividend. Next, multiply the total turnover by the resulting number divided by one hundred. This method is appropriate if the same percentage is applied to the entire assortment. It is better to repeat the calculations several times to eliminate possible errors.
Add together the products of different turnovers and the estimated trade markup for groups of goods. Next, divide the result by one hundred. This formula will be successfully applicable if different groups goods are assigned different percentages for markup.
Multiply the average percentage of gross income by turnover, and then divide by one hundred. This is the simplest markup that is applied when accounting for goods at sales prices. This method also requires the mandatory calculation of the average percentage of gross income. Add up the trade markup on the balance of products at the beginning of the reporting period and the markup on goods received during this time. From the result, subtract the products that are retired or have become unusable. Next, divide this number by the sum of turnover and balance at the end of the reporting period, multiplied by one hundred. Substitute the result into the first formula and calculate using the sample. Gross profit percentage is ready.
Add the trade markup on the balance of goods at the beginning of the reporting period with the trade markup received during the reporting period. Next, subtract the allowance for retired goods from the resulting number. From the result of the two previous actions, you now need to subtract the markup for the balance at the end of the working period. This method is suitable for calculating gross income based on the assortment of the remainder. But for implementation it is necessary to keep strict records of the markup for each product. Such accounting must be carried out at least once a month.
Profit on the balance sheet
Reflection of profit in the balance sheet is final stage summing up the financial results of the enterprise. In this case, all amounts of expenses and income of the company recorded during the reporting period are taken into account. The result is reflected in account 99 “Profit and Loss”.Determine the financial result from the main activity of the enterprise. For this, account 90.5 “Profit from sales” is used. In this case, the amount of revenue is reflected in the credit of subaccount 90.1 “Revenue”, and the cost and sales expenses are reflected in the debit of subaccounts 90.2, 90.3 and 90.4.
Calculate the revenue and expenses of the enterprise that do not fall under the definition of the main activity. Reflect these indicators on the subaccounts of account 91 “Other income and expenses”.
Reform the balance sheet. At the end of the year, close all subaccounts using internal records. To do this, the debit turnover of subaccount 90.1 and the credit turnover of subaccounts 90.2, 90.3, 90.4 and 90.5 must be written off to account 90.9. Open other income in debit, and other expenses in credit and write it off to account 91.9 “Balance”.
Reflect the enterprise’s profit in the balance sheet by opening a debit to subaccount 90.9 and subaccount 91.9 in correspondence with credits to account 99 “Profit and Loss”. If the financial result shows a negative value, then it must be reflected on the debit of account 99.
Reflect the amount of net profit of account 99 in correspondence with the credit of account 84 “Retained earnings”. After this, make a decision on its distribution, which must be confirmed by the order of the manager or the minutes of the meeting of the founders. If it was decided to use the profit to pay dividends, then it is reflected in the debit of account 84 in correspondence with accounts 70 “Settlements with personnel” or 75.2 “Settlements for payment of income”. To create reserve capital, a credit is opened on account 82 “Reserve capital” and a debit on account 84.
Next, you need to determine the purpose of the reserve and use it to cover losses of future periods, redemption own shares or redemption of bonds. If it is necessary to bring the authorized capital to the value of net assets, then the profit is transferred to the debit of account 80.
Increased profits
Each enterprise must provide for planned measures to increase profits.IN in general terms these activities may be of the following nature:
Increased production output;
- improving product quality;
- selling or leasing excess equipment and other property;
- reducing production costs through more rational use of material resources, production capacity and space, labor and working time;
- diversification of production;
- expansion of the sales market, etc.;
- rational use of economic resources;
- reduction of production costs;
- increasing labor productivity;
- elimination of non-production costs and losses;
- increasing the technical level of production.
In a market economy, the importance of profit is enormous. The desire to obtain it directs commodity producers to increase the volume of production of products needed by the consumer and reduce production costs. With developed competition, this achieves not only the goal of entrepreneurship, but also the satisfaction of social needs. However, economic instability and the monopoly position of commodity producers distort the formation of profit as net income and lead to the desire to obtain income, mainly as a result of rising prices.
Although profit is the most important economic indicator activities of the enterprise, it does not characterize the effectiveness of its work. To determine the efficiency of an enterprise, it is necessary to compare the results (in this case, profit) with the costs or resources that provided these results.
The word “profit” contains all the importance and expediency of the activities of any business entity.
It is very good for the enterprise if this value is positive. It denotes success and competent management of leaders. But if a negative value is obtained in the calculation of profit, then the enterprise is unprofitable, and the administration of the enterprise made mistakes in production plans.
Profit appears when the product is sold. Its indicator is characterized by the difference between the price of a product sold and the costs required to manufacture it. How to correctly determine profit in order to take into account all costs in calculations? This is what today's conversation will be about.
What is profit from product sales and how is it formed?
When selling its products, the company receives revenue. So, if from the amount of money received from the sale we subtract all the expenses invested in production activities for their production, then the result will be the value or, as it is also called, gross income from the sale of finished products.
In practice there is a distinction several types of profit:
- accounting;
- clean;
- economic.
Accounting profit implies the amount obtained by subtracting from revenue the expenses spent on the production of sold products, to which income or expenses from non-sales operations are also added or subtracted. Net profit is obtained by subtracting from the accounting total amount of tax fees on products sold. And the third kind economic profit calculated by subtracting the cost of production from revenue.
It is planned to receive profit from the products before the start of the reporting period. The basis is the results of analysis from the previous activities of the enterprise and other factors that influence the formation of the price of manufactured commercial products.
Why is it necessary to calculate this indicator?
The profit indicator is an assessment of the efficiency of the entire enterprise. The higher this value, the more successful the completion of all production tasks and the more economical the expenditure of funds on the implementation of production tasks. Therefore, every reporting period, profit is determined.
After the end of each reporting period, it is necessary to compare the profit indicator with its values for previous periods. The conclusion will be this: if there is an increase in the latest values, it means that production activities were carried out effectively. If this is not observed, or worse, the amount of profit has decreased, then there is an urgent need to analyze all stages of production and conduct marketing research. Otherwise it waits.
Calculated based on profit in relation to costs. A percentage within 8-10% indicates good performance of the organization. If the value is lower, then it is necessary to reduce the cost of production and think about what measures will increase profits.
If you have not yet registered an organization, then easiest way do this using online services, which will help you generate all the necessary documents for free: If you already have an organization, and you are thinking about how to simplify and automate accounting and reporting, then the following online services will come to the rescue, which will completely replace an accountant in your company and save a lot money and time. All reporting is generated automatically and signed electronic signature and is sent automatically online. It is ideal for individual entrepreneurs or LLCs on the simplified tax system, UTII, PSN, TS, OSNO.
Everything happens in a few clicks, without queues and stress. Try it and you will be surprised how easy it has become!
Methods for calculating the indicator
In economics there are several methods for calculating the amount of profit received when releasing products:
- Direct calculation method;
- Obtaining the amount of income per unit of cost;
- Analytically.
Let's look at each in more detail.
Direct counting method
This method is used provided that the enterprise produces a small range of products with a constant cost.
Calculation is carried out separately for each type of goods based on the following indicators:
- parameter of the planned production volume for a specific type of product;
- the planned cost of manufacturing one product - cost;
- estimated selling price of 1 piece of goods.
Example 1.
Initial data:
- The cost of the product at the planned cost is 10 rubles;
- The planned selling price per piece is 12 rubles;
- Production capacity allows us to produce 500 pieces per month.
The sequence will be like this:
- We determine the profit from selling a unit of goods by subtracting manufacturing costs (cost) from its price:
12 - 10 = 2 rubles. - We calculate the planned profit from the total volume of goods that the enterprise will produce in a month, multiplying the resulting number in the first step by the entire volume:
2x500 = 1000 rub.
Thus, the total planned profit should be 1000 rubles.
Calculation of profit per 1 ruble of costs
This method is used to clarify the amount of profit per 1 ruble of costs, taking into account the entire volume of output. Usually it is not used to clarify this value for specific types of products.
To get the required number you need to know these parameters:
- planned production costs;
- what amount of revenue was received in the previous period from the sale of finished products;
- how much money is expected to be received from the sale of manufactured products.
To calculate the revenue part and set a stable selling price, you need to calculate the profit from 1 rub. costs in the manufacture of commercial products.
First, determine the profit for the previous reporting period received from the sale of a unit of production using the formula:
P = F – S, rub.,
Where
P - profit;
F - wholesale price;
S is the cost of production.
The next step is to determine how profitable the operation of the entire enterprise was.
To do this, calculate the ratio of net profit to cost per unit of production:
Ren= P/S*100 (%)
If this figure exceeds 10%, then the enterprise is considered profitable.
Magnitude profit for every ruble spent determined by the following formula:
Р1rub.=S/C,
where S – cost;
C – cost of 1 piece upon sale.
All these values show not only the main profit of the enterprise, but also its percentage ratio to production costs, which should be at least 10%. Then the profitability of production is assessed as very good.
Example 2.
Initial data:
- cost per 1 rub. of the manufactured product in the reporting period will amount to 90 kopecks;
- it is planned to carry out a total production of goods worth 10 thousand rubles;
- a saving mode has been introduced to reduce costs by 1 ruble. products in the amount of 5 kopecks. for each piece.
What profit will be received from 1 rub. costs?
First of all, we determine the amount of planned costs at production cost 1 rub. products taking into account the introduced savings regime:
90 - 5 = 85 kopecks
It turns out that for 1 ruble of products at the selling price, production needs to spend 0.85 rubles, which is called the planned cost.
Since it is planned to produce goods worth 10 thousand rubles in total, then total cost will:
0.85 x 10000 =8500 rub.
Now you can determine the amount profit subject to full sale of products :
10000 -8500 = 1500 rubles
Conclusion: for 1 ruble of finished products the costs will be 0.85 kopecks, and the profit will be equal to 0.15 kopecks. This method of calculating the receipt of planned profit from product sales is quite accurate. But its disadvantage is that it is not possible to identify the influence of specific factors on the amount of profit and their changes.
Analytical method
This technique is used not only to determine the overall profit indicator, but also to analyze all the factors that influence the manufacture and sale of products.
These include:
- range and quality of products;
- volumes of goods produced;
- cost of production costs;
- wholesale cost indicators;
- profitability.
It is very important that this method makes it possible to assess the impact of various factors on the income side and at the same time take the necessary measures to maintain it at the proper level and increase it.
It is used to determine future profits in two directions: for comparable and incomparable products.
The difference between the product data is whether it was manufactured before the planned date or not. If such an event took place, then data from the previous reporting period is used to calculate the amount of future profit for comparable products. When the process of producing products that were not manufactured in the previous period is launched into production, the parameters of incomparable products are used.
Input data for comparable products:
- costs at cost in the base period – 120 thousand rubles.
- The coefficient of increase in the volume of manufactured products in the planning period is 1.15;
- Coefficient of planned reduction in manufacturing costs 1 pc. – 0.95;
- The profitability ratio for the reporting period was 0.3.
Profit amount should amount to the following amount in the planning period:
120,000x1.15x0.95x0.3= 39.5 thousand rubles.
It is convenient for calculations to reflect all the parameters in the table.
Initial data for calculation
In this case, profit calculation must be carried out separately for comparable and incomparable products.
First you need to calculate basic profit received in the previous period. Based on it, the expected amount of income is adjusted taking into account all the factors that affected this value exclusively in the base period.
Also in relation to basic profitability , which is calculated from the data of the past period. It is determined by dividing the resulting base profit by costs at cost in the same period.
Planned indicators in the future period is determined as follows:
- the cost remains based on the past period;
- the amount of expected profit is determined by the basic profitability parameter.
When calculating planned income, you need to take into account certain factors that can change the amount of expected profit (reducing costs, increasing the number of products produced, etc.)
As you can see, Calculations with this method are performed in stages:
- basic parameters of profit and profitability are calculated;
- data on comparable products, the production of which will be carried out, is determined by cost parameters for the past period before the planned one;
- using the basic profitability level parameter, the size of future profit is determined in the calculations;
- It is also necessary not to miss the determination of the values of individual factors that influence changes in income in the planning period.
The amount of monetary benefit of incomparable products can be found by direct calculation if appropriate data is available. If they are not available, then the average profitability of products for the enterprise is used.
The procedure for calculating profit from sales in the planning period
The amount of monetary benefit received from the sale of manufactured products is calculated as the difference between expenses and gross profit. The gross profit is calculated by subtracting sales costs from the amount of revenue received during sales.
Sales costs take into account only direct sales of products.
Benefit from implementation determined by the formula:
Prpr = Vpr – UR – KR
Where,
Vpr – gross profit;
UR, KR – administrative and commercial expenses, respectively;
Prpr – benefit received (profit).
For determining gross profit :
Vpr = In – Sbst
where, Sbst – sales cost;
In – the amount of revenue.
When subtracting all other expenses and taxes from the value of the benefit received, net profit will be obtained.
Preparation of accounting entries
In accounting, profit from sales involves several accounts:
What postings must be completed in order to obtain a financial result, i.e. profit margin.
They will be as follows:
- 50 /90.1 - 900 thousand rubles. – proceeds from sales in cash are entered into the company’s cash desk;
- 90.2 /41 - 790 thousand rubles. – the cost of sales is written off;
- 90.7 /44 - 68 thousand rubles. – sales expenses are written off.
Here's how to do it:
- 90.1 / 90.9 - 900 thousand rubles.
- 90.9 / 90.2 - 790 thousand rubles.
- 90.9 / 90.7 — 68 thousand rubles.
During the postings, we determine that the turnover on the credit of account 90.9 is 900 thousand rubles, i.e. the amount of sales revenue. 858 thousand rubles must be reflected in debit. (790 thousand rubles + 68 thousand rubles). Thus, at the end of the reporting period, the credit balance was 42 thousand rubles, indicating profit from sales.
Analysis of the received data
The decisive role is played by the analysis of all factors affecting the net profit of the enterprise. It is important to correctly assess the financial result of the enterprise, which should be reflected in the accounting records. This is justified by the fact that it is important for an accountant to correctly calculate the tax contributions that must be paid on profits.
The main parameter is the gross profit received as a result of sales.
Its size is influenced by the following factors:
- revenue amount;
- cost of goods sold;
- cost size 1 in physical terms (tons, pieces, l, m2 l, etc.);
- fluctuations in demand for the range of products sold.
Define gross profit size Thus:
Vp = Orp = C – C,
where Orp is the volume of products sold;
C – revenue;
C is the cost of goods sold.
It is necessary to note that the main parameters affecting the amount of gross profit are revenue indicators, cost and changes in the range of products sold.
Methods for increasing this indicator
Priority areas in the plan increasing profits are as follows:
- Full utilization of the enterprise’s production capacity in order to produce goods that are superior in their consumer properties to competitors’ analogues.
- Maximum use of production capacity for the manufacture of products that have no analogues, due to the monopoly position of the company.
- Gradual increase in volumes and sales under conditions of production of products that do not have any special features compared to analogues. To achieve this, it is necessary to improve production efficiency to reduce manufacturing and distribution costs. Marketing research must be constantly carried out to create conditions for improving sales and superiority over competitors.
Instructions for creating reports on gross profit and cost in 1C are presented in the following video tutorial:
Net profit is a concept that applies to both small businesses and large corporations. Increasing this part of income - the main task every businessman. To correctly calculate profit, you need to know its main indicators and be able to use a special formula.
This article will serve you step by step guide in net income calculation and data analysis.
Net profit: definition
Net profit is part of . This is the balance of funds after paying all mandatory taxes, fees, deductions and other payments. Due to the net share of profits, you can increase working capital, create various funds and reserves, as well as invest.
Net income is the main source of the enterprise’s budget, as well as its cash savings. This indicator allows you to stimulate the team and expand production. There are many ways to use this indicator. The management’s task is to correctly distribute available finances so that they continue to bring dividends.
Net profit indicators
In order for net profit indicators to work for the benefit of the company, they must be analyzed. This will help determine the effectiveness of each of them and the business as a whole. Based on the data obtained, you will be able to determine prospects for growth, equipment modernization and product range renewal.
It will also be possible to track how production volumes affect net profit. But first things first.
Revenue for the specified period
Analysis of this indicator is called horizontal. To study, you will need the current balance sheet of the enterprise, profit statements, financial plan companies. In some cases, it will be necessary to use other accounting documents.
You can analyze revenue for a month of operation, a quarter, or a year. It all depends on the scale of the business and the area in which it is represented. If these are direct sales, then every hour of work and the profit from it is important. If you are engaged in production, then it is enough to conduct such an analysis once a quarter or a year.
Thus, the revenue indicator within a certain time frame makes it possible to determine the profitability of the enterprise and develop an optimal strategy for further development.
Product cost
– an important comprehensive indicator that makes it possible to judge the effectiveness of the company’s use of its available resources and the level of organization of work at the enterprise.
The cost price is expressed in monetary format and allows you to determine the cost per unit of production. Typically, the final amount includes pre-production, manufacturing and distribution costs.
Analysis of the indicator makes it possible to determine at what stage production costs reach their maximum value and reduce them. This directly affects net profit, which can only be increased by reducing costs.
In reality, it may be the purchase of cheaper raw materials or free shipping any components. It could also be benefits for electricity or water supply. 
Calculation of net profit. Formula
Net profit is calculated within a certain period. Just like with the total revenue indicator, this can be a quarter, a year or a month.
All data for calculating net profit is taken exclusively within the selected period of time.
The formula for calculating net profit is quite simple:
PP = AF + VP + OP – CH, Where
PE – net profit,
FP – financial profit,
VP – gross profit,
OP – operating profit,
VP = revenue – production cost;
FP = financial income – financial expenses;
OP = operating income – operating expenses.
Also, net profit can be displayed in the form of the following formulas:
PP = B (revenue) – SP (product cost) – Administrative and selling expenses – Other expenses – Taxes
PE = Profit – Taxes
The economic meaning of each of the formulas is the same, so you can use the one that seems most convenient to you. The first in this case is more detailed and will allow you to calculate all components of your income.
According to statistics, the normal net profit in business is about 14%. If this value is less, then the enterprise can be considered unprofitable. If the net profit is completely negative, then the business is definitely operating at a loss.
However, this is considered normal when a startup has just embarked on its development path and has not yet managed to return the invested funds.
Calculation example
We offer you a simple example of a business - a small publishing agency. The total profit from the books sold for the month was $20 thousand. The rights to publish some works and some custom advertising materials were also sold. This brought in another $7 thousand and $3 thousand respectively.
The company's total profit was:
$20 thousand + $7 thousand + $3 thousand = $30 thousand.
The publishing house's total expenses for the current month amounted to $13 thousand.
Based on these data, you can determine net profit (NP) by simple subtraction.
$30 thousand - $13 thousand = $17 thousand.
The company received a net profit of $17 thousand.
Case Study
A company's income can be very different. This includes the sale of products and the sale of services. Also, income can be interest on deposits, etc. In our case, the publishing house receives income not only from the sale of books, but also the rights to various materials, custom advertising production.
It is worth considering that if any of the clients needed to pay monetary compensation, the amount would be deducted from the total profit.
Total costs also include many indicators. Include all funds spent during the reporting period. Using the example of a publishing house, this means purchasing raw materials, paying workers, electricity, renting space, etc.
As for the net profit received, in the publishing house it can be used to purchase new equipment, for example, printing presses. This will lead to an increase in the number of products produced and, in the future, to additional profits.
Thus, a one-time investment turns into a long-term investment, which in the future will help increase net profit.
Conclusion
Net profit is not just money earned, but an effective tool for developing your business. If used correctly, you will ensure rapid growth and development for the company.
Net profit can be used for the following purposes:
- replenishment of inventories;
- innovation development;
- renewal of production assets;
- creating reserves;
- investments;
- charity;
- staff development.
Return at least part of the net profit received to the business. This will lead to a stable increase in the indicator up the chart.
By tracking the dynamics, over time you will be able to enter the international arena and attract foreign investors to your project.
Business is endless statistics and graphics. Control your net profit and other indicators of your income and your business will flourish!
This article is devoted to deciphering concepts that seem to be synonyms. We will talk about profit, revenue and their types.
Definition and calculation formula
Profit It is customary to call the difference between revenue from the sale of goods/services and the costs of their production/provision.
Profit is an important economic indicator that serves to reflect the effectiveness of business activities.
Profit and revenue are not the same thing. The formula for calculating profit is very simple:
Revenue – Expenses = Profit
Net profit
Net profit is the money that remains with the company after various deductions, taxes and other payments are subtracted from the balance sheet profit. Net profit is a source of financing production processes. It also forms reserve funds, and it is through it that working capital increases.
The main factors influencing the amount of net profit are:
- the amount of tax and other payments;
- company income from the sale of goods/services;
- cost price.
How to calculate net profit
The volume of net profit is calculated in several stages.
- 1. The first step is to calculate how much money was spent on the production of the product (the cost of the material is also taken into account).
- 2. Then the calculation should be made. Gross income is the result of subtracting production costs from revenue (i.e., funds received by the enterprise as a result of the sale of goods).
- 3.
This is enough to find out the amount of net profit:
To calculate net profit, you need to subtract mandatory deductions (taxes, etc.) from gross income.
Gross profit
To calculate gross profit, you need to subtract the cost of the product from the amount received by the company as a result of its sale.
How, then, does gross profit differ from net profit? And the fact that all tax and other deductions are “included” in the gross.
To correctly calculate gross profit, it is necessary to accurately calculate the amount of expenses, including.
Cost price- These are the company's costs for producing goods.
Factors affecting profit
Factors influencing the volume of gross profit are divided into two groups: internal and external. Internal ones depend on the management of the enterprise. Here they are:
- trading performance;
- improvement quality characteristics goods;
- increase in production volume;
- reduction of production costs;
- rational (most efficient) use of production capacity;
- work to expand the range;
- effective advertising campaign.
Concerning external factors, then management cannot influence them. Let's list them:
- location of the enterprise;
- environmental situation in the region;
- natural features;
- government support for business;
- political situation in the country and the world;
- features of the economy (country and world);
- provision of transport and necessary resources.
What is the revenue?
Revenue is what a company receives as a result of the sale of goods or the provision of services. It is no wonder that any company strives to generate revenue. Revenue and profit, as already mentioned, are not identical concepts, because profit is the difference between revenue and expenses.
Sources of revenue may vary. The following types of revenue are distinguished (based on its source):
- 1. Revenue from the sale of a product or service. It includes all funds received by the enterprise as a result of the sale of its products within a certain period.
- 2. Investment proceeds.
- 3. Revenue received as a result of financial transactions.
total revenues is the sum of funds received from all these sources.
About Gross Revenue
Gross revenue is the total income received by a company as a result of the sale of goods, as well as other operations not related to sales. However, the main component of gross revenue is sales revenue. The following formula is used to determine gross revenue:
ВВ = Quantity of goods * Unit price of goods
Since gross revenue does not take into account production costs, it cannot be considered the main indicator of enterprise performance. But when it comes to comprehensive performance assessment, gross revenue is also taken into account.
To summarize, let's look at the formula again. So:
Profit = Revenue – Expenses
From this formula it is clear that profit and revenue are not synonymous. When calculating profit, all expenses of the enterprise are taken into account, and not just the cost of goods. In addition, the profit can be negative.
The profit of an enterprise is the most important indicator that reflects the result of its activities and indicates how rationally and effectively it was used production resources. In a broad sense, profit is understood as a positive difference between income and costs, while a negative difference is a loss. Depending on the calculation method, profit is distinguished:
- From sales - when calculating it, in addition to the cost, administrative and commercial expenses are taken into account.
- Gross - gives an assessment of results in a broad sense, representing the difference between total sales revenue and production costs.
- Before taxation - when calculating it, operating income and expenses are additionally taken into account, as well as income and expenses from activities not related to the sale of products.
- Net - calculated after tax, calculated minus tax liabilities.
An enterprise may make a profit or loss based on the results of its activities. These indicators are subject to analysis, which will provide an understanding of what factors influenced the result, to what extent, and what actions should be taken to change the situation for the better.
Goals of Analysis
Analysis of the indicator will allow us to solve the following problems:
- assessment of the compliance of the obtained financial result with the planned profit indicators, taking into account the volume of products sold;
- assessment of strategic objectives in terms of profit generation;
- identification of factors and components, as a result of which the actual profit indicator deviated from the planned one;
- identification of methods by which it will be possible to improve the profit indicator.
Carrying out the analysis allows the company's management to determine the main ways for further development of the enterprise and to find hidden reserves to improve financial results. The results obtained help to identify bottlenecks, adjust plans, increase the efficiency of resource use and the company’s activities as a whole.
Evaluation Information
To spend comprehensive analysis indicator, company management uses information from:
- financial statements;
- profit accounting register;
- financial plan.
Ways to increase profits
Increased profits can be achieved by increasing revenues or reducing enterprise costs. Sales income can be increased by increasing sales volumes or product costs. An increase in cost can have the opposite effect - a drop in sales. Therefore, this method is used less frequently, usually during times of rising inflation.
Before raising the price, it is necessary to study the market, competitors' offers and consumer expectations. There are non-price methods to stimulate profit growth. These include a balanced marketing policy, expansion (updating) of the assortment, and improving the quality of goods.
Cost reduction can be achieved through efficient use of resources. Today they are actively using innovative technologies, which make it possible to more efficiently use fuel, raw materials and labor resources, and reduce depreciation charges. You can also reduce costs through competent logistics, using staff optimization (outsourcing), using modern methods cost management.
It is necessary to evaluate profits, as this allows you to identify deviations from planned indicators and respond to external challenges in a timely manner. Based on the analysis, the management of the enterprise can develop a set of measures that can qualitatively improve the financial result.
Loading...