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| '''[[w:Multidirectional]] [[w:import]]/[[w:export]] == International trade''' | | '''[[w:Multidirectional]] [[w:import]]/[[w:export]] == International trade''' |
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| ==== Balances and flow statements ====
| | '''[[w:Business administration]]''' |
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| An '''[[w:income statement]]''' (also referred to as '''''profit and loss statement (P&L)''''', '''''revenue statement''''', '''''statement of financial performance''''', '''''earnings statement''''', '''''operating statement''''' or '''''statement of operations''''') is a company's [[w:financial statement]] that indicates how the [[w:revenue]] (money received from the sale of products and services before expenses are taken out, also known as the "top line") is transformed into the [[w:net income]] (the result after all revenues and expenses have been accounted for, also known as Net Profit or the "bottom line"). It displays the revenues recognized for a specificperiod, and the [[w:cost]] and [[w:expense]]s charged against these revenues, including [[w:write-off]]s (e.g., [[w:depreciation]] and [[w:amortization]] of various [[w:asset]]s) and [[w:tax]]es. The purpose of the income statement is to show [[w:Management|managers]] and [[w:investor]]s whether the company made or lost money during the period being reported. ( Wikipedia )
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| Example for small scale import/export business [[w:Income statement]]:
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| :''''+ [[w:Revenue]]''' aka. '''[[w:Top line]]''', '''[[w:turnover]]''', '''[[w:income]]''' and '''[[w:cash flow]]'''
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| :'''- [[w:Fixed costs]]''' (
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| ::- [[w:Personel]] costs
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| ::- [[w:Facilities]] and [[w:office]] and [[w:bookkeeping]] [[w:cost]]s )
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| :'''- [[w:Variable costs]]''' (
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| ::- [[w:Unit price]] x lot size
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| ::- [[w:Duty (economics)|Duties]] and [[w:tariffs]] or in case of [[w:single-market]] or [[w:free trade area]] no need
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| ::- [[w:Logistics]] and [[w:warehousing]]
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| ::- [[w:distribution]] costs
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| ::- [[w:VAT]]
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| : )
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| :________________________________
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| :== '''[[w:Net income]]''' - also referred to as the '''bottom line''', '''net profit''', or '''net earnings''' - is an entity's [[w:income]] minus [[w:expenses]] for an [[w:accounting period]].
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| To understand what's going on with a [[w:business]] in addition to having an [[w:income statement]] one must also have knowledge of where the capital is, what is it's cost and it's payoff i.e. the '''[[w:Balance sheet]]''', then you can calculate all sorts of fun [[w:metrics]] like [[w:Return on equity]] and [[w:return on investment]] etc.
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| :::''' much more information in the notes for [[DEC#Accounting|Accounting 1]]
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| === Courses in English === | | === Courses in English === |