Get to know the guide on how to calculate profit and loss. Simple things that merchants need to know

Get to know the guide on how to calculate profit and loss. Simple things that merchants need to know ❗
Get to know the words "profit" and "loss"
The definitions of these two terms can be explained simply: profit is income that is greater than expenses. loss part It will happen when the business generates less than the initial investment. which, if done in the form of an equation, will be as follows:
Income - Expenses = Profit/Loss
believe that many People have probably seen this equation through their eyes for some time. When many people see it, they may think that the profit and loss method may not be very difficult because "income" is definitely coming from sales. However, the more complicated part lies in the "expenses", which must be clearly defined. If it is a store with a storefront You have to take into account many expenses, from product cost, rent, employee wages, gas, electricity, water, insurance, etc. If you look at this, then Making a profit can be difficult compared to online shopping sites. with less cost
Other important formulas for business
In addition to calculating profits and expenses There are other calculation formulas. that the seller can use with your online store as well, such as
- Assets = Liabilities + Owner's Equity
It is used to analyze the financial structure of an entity. that all of the assets of the business arise from the capital of the consolidated business owners from debt generation, such as bank loans how many
- Retained earnings at the end of the year = Retained earnings at the beginning of the year + Net profit - Dividend paid
It is an accounting formula for preparing the retained earnings statement. which is a statement showing the operating results from the inception of the business until the current accounting period how much the company has increased retained earnings
- Direct depreciation = (asset value – salvage value) ÷ number of years in use
For business owners who invest in long-term assets such as machinery to produce products Must depreciate on that asset. according to accounting principles with the assumption that Assets deteriorate over time rather than use. And that deterioration will be at the same rate every year.
📌 "Profit"
profit point of view What most people think of is “Sell goods above cost” If you sell clothes that cost 100 baht and sell it to a customer for 350 baht, your profit is 250 baht, which is to say. Initial profit itself. However, initial profit alone is not enough for serious business because trading costs more than profit minus cost of goods. If we sell at the market, we must pay the rent. If selling through an online sales app, there may be advertising costs that all have to be calculated in order to find net profit or gross profit. The formula for thinking is
Net Profit = Total Revenue – Total Expenses
The benefit of this kind of thinking is for entrepreneurs to know that What is the actual profit from the sale of a product or service? because if a loss or a negative net profit It will be able to find the problem point thoroughly and fix it in a timely manner. Before the business is damaged or there is an expense to the meat itself.
📌 How to sell things without losing
In addition to the profit and loss method Selling things without loss Must make sales more than expenses. which the seller must understand the various expenses as mentioned above Besides that Other factors related to doing business also need to be taken into account, such as working capital, reserve funds and bookkeeping.
For this section, let's take an example of the expenses that most sellers have to take into account. Let's consider the following costs and expenses:
- What is the cost of the product purchased?
- Marketing expenses such as advertising or publicizing the store on various media
- Rent at or if selling through online sales websites It may be a domain name service fee.
- Owner's salary Don't forget to give yourself a salary. which may be more or less depending on the consideration
- Other expenses such as taxes, car expenses, water and electricity bills
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