The profit of an enterprise is the goal of its work, the end result of its activity. The distribution of profits at the end of the year occurs at the enterprise at its own discretion. The goals for which the net profit remaining at the disposal of an economic entity as a result of its activities can be determined by the charter.
Instructions
Step 1
Any enterprise directs its profits, first of all, to payments to the budget and off-budget funds, and then to the creation of a consumption fund and an accumulation fund, charity and other purposes.
Step 2
After all mandatory payments (taxes and fees) have been paid, the profit of an economic entity is used to form an accumulation fund. Its creation, like the creation of a consumption fund, is provided for by the constituent documents. The accumulation fund is necessary for the development of the material and technical base of the enterprise.
Step 3
Its funds are spent on the reconstruction of existing equipment, the acquisition of new equipment, the repayment of investment loans, the maintenance of social and cultural facilities, etc. The accumulation fund testifies to the existing capabilities of the enterprise for further building up the material base.
Step 4
The consumption fund is the funds that an economic entity directs to material incentives for employees. It is spent on annual bonuses and bonuses, on incentives for employees, on fares, meals, benefits, additional payments to pensioners, payment of interest on shares (dividends).
Step 5
In addition, the company's net profit is channeled to the reserve fund. This is a fund designed to pay income on preferred shares and bonds in case an economic entity does not have enough funds. In addition, the company will pay off accounts payable from the reserve fund if it goes bankrupt.
Step 6
Each enterprise plans to distribute profits annually. For this, data on the actual use of funds, as well as balances at the beginning of the period, are analyzed. Most commercial firms spend their profits on the formation of the accumulation fund and the consumption fund, about 30 and 40 percent of the profits, respectively.
