Working Edge Club

Hello         Net Profit Percentage    Net Profit % before/after Tax = Net Profit before or after Tax /Sales     Net Profit % before/after Tax shows the profit per R1 of sales after all expenses, excluding/including tax     Higher the Net Profit %, the higher the profitability, after expenses       Keywords Net [...]

Hello         Gross Profit Percentage    Gross Profit % is also known as Gross Margin %     Gross Profit % = Gross Profit / Sales     Higher the gross profit %, higher the profitability of business, after direct costs       Keywords Sales Cost of Sales Gross Profit       Did You find [...]

Hello         Net Profit    Net Profit = Gross Profit – Operating Expenses – Interest – Tax     Net Profit before / after taxation figures are used in financial statements     Net Profit shows the profit, after all expenses, available to the owners of the business       Keywords Gross Profit Net Profit [...]

Hello         Gross Profit    Gross Profit = Sales – Cost of Sales     Gross Profit excludes operating expenses, interest and taxation     Gross Profit shows the profit after deducting direct costs of making a product       Keywords Sales Cost of Sales Profit       Did You find this Q&A helpful? Post [...]

Hello         Cash & Credit Sales    Total Sales = Cash + Credit sales, is shown in the Income Statement     Cash Sales increase bank balance.  Bank is shown under Current Assets in the Balance Sheet. Bank balance is shown in the Cash Flow Statement.     Credit Sales increase debtors balance. Debtors are [...]

Hello         Provision for Bad Debts     100% of debtors are unlikely to pay the amount owed to the business. A % will not be collected/received     Provision for Bad debts is an estimate of the debts that will not be paid in the financial year     Estimate based upon historic info,  debtors [...]

Hello         Bad Debt     Bad debt is amount owed to the business, that will not be collected/received     Bad debt is shown under Expenses in the Income Statement     Bad debt will reduce Debtors in the Balance Sheet       Keywords Debtors Bad Debt Cash       Did You find this Q&A [...]

Hello         Debtor Schedule    Debtor schedule usually prepared with the cash budget     Debtor schedule shows R to be collected from debtors over the budgeted period     Debtor schedule used for planning, budgeting and cash flow management       Keywords Debtors Budget Cash       Did You find this Q&A helpful? Post [...]

Hello         Debtor Collection Period    Collection Period = Debtors/Credit sales * 365 = number of days     It shows the number of days from the sale until cash is received by the business     The higher the number, the longer debtors are taking to pay the business       Keywords Debtors Collection [...]

Hello         Benefits Factoring    Access to cash without waiting for debtor to pay you     Save debtor management, administration & collection cost and time     Expand business without additional equity or debt financing       Keywords Debtors Factoring Cash       Did You find this Q&A helpful? Post comments only about the [...]