How to calculate economic profit

If you set out to increase the effectiveness of a trading company, then "put" the value of expected profit in the margin of goods. What result you will achieve depends on the method of calculating the premium. If we are talking about small stores, then determine the trading margin "manually" and you do not have to spend money on expensive software. Proceed from the total turnover, from the assortment of turnover, from the average percentage, from the assortment of the balance of goods.

Instruction manual

1

Calculate the gross income for the total turnover, if a single percentage of the trade allowance is applied to all goods. In this case, first set the gross income, then determine the margin. To calculate gross income, multiply the total turnover by the estimated trade margin, and divide the result by one hundred. To calculate the trade margin, first add 100 and the trade margin as a percentage, then divide the same trade margin by the result.

2

If in your case you are working with an unequal allowance for different groups of goods, then profit calculation is complicated. Be sure to keep a record of turnover. To calculate gross income in this situation, first multiply the trade margin for each group of goods by the value of their turnover, then add up all the results and divide the amount by one hundred.

3

In calculating profits, you can apply the premium on the average percentage, if you take into account the goods at the selling price. To get the gross income by the average percentage, multiply the turnover by the average percentage of gross income. Divide the result by 100. If you need to find the average percentage of gross income, first add the trade margin on the balance of products at the beginning of the reporting period and the mark-up on the goods received for the current time. Subtract the trade margin on the retired (write-off or refund) from the amount. This is your first average percentage calculation result. Now add the value of the turnover and the balance at the end of the reporting period, divide the amount by 100, you get the second result. Now divide the first result into the second result.

4

If you are calculating gross income from the assortment of the balance, then consider the amount of the trade margin. To do this, keep a record of the accrued, realized premium for each item of goods. At the end of the month, take an inventory to determine these amounts. To calculate gross income for the assortment of the balance of goods, first add the trade allowance for the balance of goods at the beginning of the reporting period and the trade allowance for goods received for the same period, subtract the trade allowance for retired goods from the amount, and subtract the markup for the balance at the end of the result. reporting period.