There are several classifications of accounting financial results in the economic sphere. The most frequently used indicators are listed below:
Gross profit or loss
Gross profit/loss. Refers to an intermediate type of financial results. This indicator is reflected in the reporting and is determined by accounting data. Gross profit/loss is determined by subtracting all costs from the total revenue from the current type/types of activity. The cost of products or services sold directly depends on their cost price, which consists of such costs as material, human, etc.
These financial results can be used to judge the profitability of sales and to find out how efficiently the company's resources are being used. It should be noted that the report does not provide information on the division of types of indicators of this kind, so if a detailed analysis of gross profit is required, additional sources of information are needed, which often constitute a commercial secret of the enterprise.
The concept of the financial result of a company
As mentioned earlier, gross profit is the difference between the revenue from the sale of goods and the costs of their creation. The concept of revenue includes all receipts from the company's sales activities without value-added tax. The cost price includes all costs of the production process, but when calculating gross profit, it does not include commercial and management costs.
Most often, this financial indicator is calculated at the end of the reporting period - month, quarter, year. But depending on the needs of a specific organization and the features of its management system, it is permissible to use any other time period to determine gross profit.
Profit or loss from trading activities
It is this indicator of financial results that includes commercial expenses and management costs. Knowing the value of gross profit, as well as these expenses, you can determine the profit/loss from trading activities.
Commercial expenses, expressed the benefit of using our student database in distribution costs, are typical for trading organizations, and in manufacturing enterprises and companies operating in the service sector, they include expenses on wages and insurance premiums.
In addition to the main activity, production of something or provision of services, the organization can perform various economic operations related to the purchase and sale of assets. As a result of such processes, the following indicators are formed:
income from participation in other organizations;
amount of interest receivable;
interest payable;
other expenses and income.
Profit/loss before tax