How to calculate business activity
Video: How do I Complete my Business Activity Statement? 2024, July
Business activity determines the efficiency of the enterprise’s economic activity, which can be calculated in one of two ways - by reflecting the performance of the enterprise in relation to either the amount of advanced resources or the amount of their consumption in the production process. It is reflected, first of all, in the speed of turnover of enterprise funds. The profitability of the enterprise reflects the degree of profitability, and in general, the coefficients of business activity make it possible to analyze the effectiveness of the use of funds by the enterprise.
Instruction manual
1
Return on assets is the amount of revenue from sales per ruble of fixed assets. It is calculated as the ratio of revenue from sales to the average annual value of fixed assets.
2
The turnover of funds in the calculations with an increase is considered as a positive factor, in the case of a decrease in this indicator, a decrease in sales or an increase in receivables. It is calculated as the ratio of sales revenue to average receivables.
3
Inventory turnover characterizes the rate of consumption or sale of raw materials or stocks. It is calculated as the ratio of revenue from sales to the average cost of inventories and costs. It can also be calculated as the ratio of cost of sales to costs.
4
Accounts payable turnover relates the amount of debt and the amount of goods purchased in the amount of the loan. It is calculated as the average payables multiplied by the analysis interval, related to the cost of sales or revenue from sales.
5
The duration of the operating cycle is the time between the purchase of raw materials and the receipt of revenue from sales of products. In order to calculate it, add the turnover of funds in the calculations in days and the turnover of stocks in days.
6
The duration of the financial cycle is the period of time from the moment of payment to suppliers of materials (repayment of accounts payable) and until the receipt of money from buyers for goods shipped.
