Search results for the string: return on cost. Product profitability shows the result of current costs

21. Analysis of the income statement

transparent to the investor, identify and compare profitability activities of the organization both with the industry average and with data from other enterprises. The construction of a profit and loss statement is carried out in the context of various sources of income and expenses, which can be attributed to various types activities of the organization (Table 1). Table 1 Result from core activities Revenue. Cost price goods sold. Profit from sales. Result financial activities Interest receivable...

22. How to estimate the value of a company adjusted for the crisis

equity: total assets); profitability equity(ROE, net profit: average annual equity capital X 100%); turnover duration accounts payable(average amount of accounts payable for the period X 365 days / cost price goods sold); duration of turnover of net production working capital (average value of net production working capital for the period X 365 days: sales revenue)...

23. Assessing the impact of the tax system on the efficiency of industrial innovation

reduction in insurance payments - 0.88 million rubles. Profitability sales will increase from zero to 21.8%. Level current assets associated with this production is 31% of the annual value production costs products. About 70% of the increase in current assets is covered by the increase in accounts payable...

24. Features of factor analysis of performance indicators of an economic entity

Product type Profitability products, % Change in profitability, % Change in profitability due to factors, % base year reporting year Price change change production costs Men's sports suit 3.20 0.30 -2.90 -5.60 2.70 Women's jumper 2.30 1.15 -1.15 0.0078 -1.1539 Underwear women's 6.40 1.30 -5.10 -679.40 674.30 Men's sweater 5.20 6.90 1.70 16.50 -14.80 Women's sweater 4.50 3.40 -1.10 9, 60 -10.70 Set of clothes for children 8.50 6.00 -2.50 -31.50 29.00 Men's socks 13.00 12.00 -1.00 35.00 -36.00 Women's tights 6.40 7.10 0.70 17.77 -17.07 Work mittens 23.00 3.40 -19.60 42.00 -61.60 Profitability total output 5.50 4.30 -1.20 -0.70 -0.50 Analysis of the profitability of production assets, calculated as the ratio balance sheet profit to the average cost of fixed assets and material balances working capital, carried out according to next model: The initial data for analyzing the dynamics of fund profitability are presented in table...

25. Financial ratios - Return on sales

Profitability sales a) The rate of revenue growth is faster than the rate of cost growth. Possible reasons: growth in sales volumes, change in the range of sales. With an increase in the number of products sold in in kind Revenue increases faster than costs as a result of production leverage. Components production costs

26. Financial ratios - profitability of products sold

Scheme 1. Increasing the indicator Profitability products sold. a) The rate of revenue growth is faster than the rate of cost growth. Possible reasons: increased sales volumes, changes in the sales mix. With an increase in the number of products sold in physical terms, revenue increases faster than costs as a result of production leverage. Components production costs products are variable and fixed costs...

27. Financial Dictionary - Operational Analysis

as a whole, and its components separately ( profitability sales, assets, investments); level of business risk; develop an assortment policy that is beneficial for the enterprise. Operational analysis is carried out according to the “costs - sales - profit” scheme. When conducting a factor analysis of profit, data from the profit and loss statement were used, in which expenses were allocated according to the areas of activity of the enterprise, including expenses for production costs; commercial, administrative, operating, non-operating and extraordinary expenses...

28. Financial ratios - return on sales by profit before tax

Scheme 1. Increasing the indicator Profitability sales at profit before tax. a) The rate of revenue growth is faster than the rate of cost growth. Possible reasons: increase in sales volumes, change in sales mix. With an increase in the number of products sold in physical terms, revenue increases faster than costs as a result of production leverage. Components production costs products are variable and fixed costs...

29. Improving accounting and analytical support for managing the organization’s working capital

provision of product output with contracts. Profitability sales Timeliness of product deliveries Receivables management strategy Value accounts receivable. Amount of accounts payable Turnover period of accounts receivable. Share of doubtful accounts receivable Cost management strategy Cost price products. Structure production costs. The amount of variable costs...

30. Express analysis of financial and economic activities

duration of the operating cycle, profitability sales, etc. Other indicators are less obvious; in particular, these include an indicator characterizing the share production costs in revenue. Obviously, based on the dynamics of this and similar indicators, certain conclusions can be drawn about financial situation enterprises...

31. Analysis of the creditworthiness of small enterprises by a bank credit expert

borrower data. Too high profitability business of a potential borrower relative to similar activities may indicate an understatement by the client production costs or expenses not included in cost price, or about overestimating the amount of revenue (income)...

32. Operating leverage in assessing the sustainability of companies

regional companies - “share fixed costs - profitability products”, which will provide a complete picture of the levels of operating leverage and its impact on both the financial stability of the company and the prospects for profit growth. When analyzing the economy of a region, it is necessary to evaluate the ratio of companies in terms of profitability level and the share of fixed costs in production costs, which determine operating leverage. For example, special attention require large companies With high level fixed costs and low profitability(the level of operating leverage is high), since even a slight change in revenue can lead to a sharp drop in profits (a sharp increase in losses), which will have an impact on the economy of the entire region...

33. Analysis as a stage of audit of income tax calculations

according to statistics. Profitability sold goods, products, works, services is defined as the ratio of the value of the balanced financial result from sales (profit (loss) from sales) and production costs sold goods, products, works, services. Negative balanced financial results from sales indicates the unprofitability of the organization's activities...

34. Financial dictionary - Economic activities of an enterprise

profit affects indicators such as profitability, solvency of the enterprise and others. The total profit of the enterprise ( gross profit) consists of three parts: profit from product sales - as the difference between revenue from product sales (excluding VAT and excise duty) and its total cost; profit for sale material assets and other property (this is the difference between the sale price and the costs of acquisition and sale)...

35. Financial analysis of small business development in Russia

and services. As can be seen from the given data, profitability sales overall for small organizations from 2000 to 2004 decreased by 1.3%, although it should be noted that the absolute value of the indicator during this period was very low - from 3.1 to 1.8%, with the exception of transactions with real estate(11.9%). The decrease in the level of profitability of sales is associated with an increase production costs units of products produced in small organizations and an increase in sales volume...

Profitability comes from the word rent, and rent literally means income. Based on this, profitability is Speaking in simple language, this is a situation where income exceeds expenses. IN in this case, from an economic point of view, any enterprise that makes a profit can be considered profitable.

Profitability indicators characterize the operation of an enterprise and show how profitable various areas of its activities are. They characterize the final results of business more fully than profit, since their value shows the relationship between the result (effect) and the resources available and consumed in the production process. They are less dependent on inflation than profit indicators. Profitability indicators are used to evaluate the activities of an enterprise, as a tool in investment policy, as well as pricing.

There are several groups of profitability indicators:

1. Indicators characterizing the profitability of core and investment activities.
2. Indicators characterizing profitability of sales or profitability of turnover.
3. Indicators demonstrating how profitable capital or its individual parts are.

Product and enterprise profitability

It is calculated both for the enterprise as a whole and for each type of product. The size of this indicator depends on the quantity and structure of products produced by the enterprise.

Product profitability is determined by the ratio of profit to cost.

R=P/S*100, (%).

Product profitability shows which products are more profitable for production, that is, which products are worth producing and which are not. The cost of production must correspond to the costs.

Product profitability shows the amount of profit per ruble. It means the ratio of profit to the costs of production and sales of products. It is also the rate of profit.

Product P = (Price - Cost) / Cost * 100, (%).

Product profitability shows whether the production of products is efficient and to what extent, and in general, the efficiency of the enterprise.

Product profitability shows what the result is running costs.

Production profitability is calculated using the formula:

P total = Profit / (Fixed assets + Working capital) * 100, (%).

Calculated using the formula: UR = P/S, Where

P - net profit;

C is the cost of goods sold.

For increase this indicator it is necessary to increase profits and reduce the cost of production.

By investment projects the profitability index is calculated:

IR = Profit / Investment amount.

Profit / Revenue amount.

Return on capital is assessed using Represents the ratio of profit to the cost (average annual) of invested capital.

During the operation of an enterprise, a process occurs that is continuous. The structure of funds, the sources of their formation change, the available resources and the enterprise’s need for financial resources, changes External manifestation it is the solvency of the enterprise. The inner side is characterized financial stability, reflecting the balance of income and expenses, funds and, accordingly, sources of their formation.

In order to increase the level of profitability, an enterprise must pursue a flexible policy in the field of production and sales of products, focusing on market variability.

The efficiency of an organization reflects the final result of the use of resources for certain period time. It is characterized by increased productivity, quality of facilities and materials. To measure these parameters, absolute and relative indicators are used. The first includes profit and other cost values. The second is cost effectiveness. For the purpose of analysis, calculated data are compared with planned or indicators for previous periods.

Essence

Profitability is a general indicator characterizing the activities of an organization in terms of the ratio of costs and profits. The final result is influenced by internal (organizational) and market conditions. The first group includes productivity dynamics, specifications equipment, method of organizing work, etc. external factors include prices for resources that the enterprise uses to manufacture products, and the cost of the finished product.

The growth in profitability is accompanied by an acceleration in turnover, a reduction in costs, and an increase in selling prices. Western economists believe that capital intensity, product quality, the enterprise’s share in the segment and other indicators are also of considerable importance.

Return on assets

The efficiency indicator for using funding sources displays how much money from profit is invested in buildings, equipment, and finished products:

R ak = ( Net profit(PE) / Average annual cost all assets) x 100%.

The efficiency of operating production assets and current assets is calculated separately.

Capital productivity = PE x 100% / Weighted average cost of fixed assets.

R ob = PE x 100% / Weighted average cost of OA.

Let's look at an example of analyzing indicators.

Data	Plan	Fact	Deviation
1. Net profit	1860	1980	+120
2. average cost OS	15090	15590	+500
3. Average cost of intangible assets	-	110	+110
4. Average cost of OA	5530	5920	+390
5. Total assets (2+3+4)	20620	21620	+1000
Profitability = (1) / (5)	9,02	9,16	+0,14

The cost return ratio increased by 0.14 points. After spending factor analysis, we can conclude that the growth was influenced by the following:

• increase in profit: 120 / 21620 x 100% = + 0.56 points;
• change in asset value: + 0.56 – (+0.14) = -0.42 points.

That is, the efficiency of asset use has increased due to profit growth.

Capital efficiency

Return on investment shows the quality of use of funds invested in the organization. It is calculated using the formula:

P and = Profit before tax / (Balance sheet total - Short-term liabilities) x 100%.

Return on equity (ROE) shows how much profit falls on a unit of capital of the organization:

R sk = PE / SK x 100%.

It makes sense for an enterprise to receive loans if the efficiency of capital use increases after the investment additional funds. Lenders and owners of the organization count on income from invested funds in the future. From the first point of view, the profitability indicator borrowed money is expressed by the following formula:

R zk = Interest on loans / (Long-term + Short-term loans) x 100%.

Shareholders calculate their returns differently:

R zk = state of emergency / Borrowed capital x 100%.

The efficiency of using the total amount of capital is calculated using the formula:

R cap = (Costs for raising borrowed funds + PE) / Currency (Total) balance x 100%.

Changes

The profitability of an enterprise's costs can be analyzed by comparing indicators of the efficiency of use of assets and capital. Return from own funds increases if the share of accounts receivable increases. The difference between these two indicators forms the effect financial leverage. If profit increases through the use of loans, then return on assets, minus interest on loans, is greater than zero. In such cases, they say that the profitability of the loan covers the costs of its use.

Return on sales shows specific gravity income as part of revenue. If the indicator decreases in dynamics, then this indicates low competitiveness of products and a reduction in demand. With a constant sales structure, sales profitability depends on prices and cost levels. Qualitative growth in profitability is achieved by increasing the first indicator while reducing the second. To do this, the organization must focus on market conditions, systematically regulate prices, control production costs, review and update the range.