Net income - is one of the most important factors that affect the profitability of a business entity.Significantly, the analysis of this indicator can provide an answer to the question of whether to continue the enterprise begun by the way, or look for other revenue opportunities.
Net profit - it remains at the disposal of part of the income received after all made for the production and marketing costs, as well as the payment of compulsory payments and taxes.Its purpose is to encourage the team and the expansion of production processes.Net profit in the calculation of the dividend effect, intended to reward shareholders.It is used as a source for the formation of reserves and funds, as well as for the growth of non-current assets and reinvest in production.
net profit - a key indicator for any enterprise.Its value is the result of activity of a business entity.The successes are reflected in the company's growth, and the failure - the fall of this indicator.
Net income definition which is an important point for the analysis of the enterprise, begins with the establishment of the size of the gross income.This index is the sum of the proceeds received from the sale of services, goods, works, taking into account discounts and does not include the value of goods that were returned to the company's customers.Our next step is the calculation of all incurred for the production of goods and services spending.After this is determined by the gross margin is the difference between gross income and costs.And the value is determined by other expenses.It includes the following costs:
- searching for new markets and partners;
- to sign new deals;
- by force majeure;
- the payment of fines, penalties and interest on loans.
Net income - the difference between gross income and the cost, as well as other income and taxes.If the amount received will be with the "minus" sign, it will indicate the loss-making enterprise.
use of net profit depends on the decision of the head of the organization.Most often it is directed to the formation of various reserves and funds, payment of dividends, as well as the order remains in storage.Due to the net profit of the company may have a charity, it lists certain percentage of social spending.
normal average value of net profits derived economic services of Britain, must be fourteen percent.Companies that receive a value less than this figure, according to them, can be considered a loss.
Net income refers to the group of the most powerful indicators of financial reporting entity.Data on the size of this value is of primary interest to the outside world.If the dynamics of the reporting period, net profit has considerable fluctuations, this fact will cause the cautious attitude of investors.In this case, the organization will have to provide a detailed explanation of the reasons that caused these changes.
is not possible to accurately assess the operation of the enterprise, based on only one indicator - net profit.Types of income that also affect the opinion on the effectiveness of the business entity - it's two components of income.Their values are reflected in the annex to the balance sheet.You can find them in the profit and loss account.Methodology reflection of these indicators and the procedure for their accounting contained in IAS 8. These include the profit (loss) from ordinary activities and the results of an emergency.
