Organizing a business is not easy. Especially if you have to manage a wide staff and a large number of assets. Every manager must remember one rule, without which management is impossible: the primary task of any enterprise is to make a profit. Further, such management tools as short-term and long-term planning, economic analysis, accounting and management accounting come into play.
Instructions
Step 1
So how do you determine the income of a business? First, you need to figure out what this very income can consist of. First, it is money received directly from the sale of a product (produced or resold) or service. In other words, the gross profit of the enterprise. The second component of profit, oddly enough, is the cost.
Costs are money spent in the production or sale of goods, or in the provision of services. Costs are fixed and variable. Fixed costs are the costs of management and administration, wages, maintenance of assets (that is, production facilities, buildings and structures), rent, etc.
Step 2
Variable costs include the money spent on the purchase of the material from which the product is made, or on the purchase of the product itself (if we are talking about resale). In the case of the provision of services - the costs of their provision.
Step 3
So, the last on the list, but by no means by importance, remained the component of profit - taxes. Why is the last one on the list? It's simple - the tax is calculated based on the taxable base and the interest rate. The taxable base, in turn, is calculated on the basis of gross income and expenses.
Step 4
Result: income (or net profit) of the enterprise = gross profit - (variable costs + fixed costs) - taxes.
Thus, you have received four indicators that can be calculated in monetary terms. So, having calculated them, you can easily calculate the income of the enterprise. In addition, these indicators are the main tools for planning and analysis. With their help, you can predict income, optimize costs.
