• Registered: 07/23/2009
  • Posts: 14

Topic: Income, Cost of Income and Other Income

Please inform me  when the Gross profit is calculated if it takes the Other incom also into account or not

Normally what happens is
Income - Cost of Income =Gross profit

Only thereafter Other income is added to the Gross profit

Gross profitis used to calculate the sales price of items

With Other income like interst earned a distorted picture is created 

Please advice

  • joe
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  • Registered: 03/15/2007
  • Posts: 5,107

Re: Income, Cost of Income and Other Income

Hello, If you want your Profit & Loss Statement to show the Gross profit, before showing other income, you will have to re-arrange your account classes/groups(types). When running the PL statement the sequense is ordered by class and group (type).
Maybe you should make a backup before experimenting. Or try the Training Co. first.

/Joe

  • Registered: 07/23/2009
  • Posts: 14

Re: Income, Cost of Income and Other Income

Thx Joe

How does the background work
i.e Is the GP calculated When the COS is direct below the Normal income or is the GP calculated from all the Items that is linked to the Income class and all the items linked to the COS class if the last is true then it does not matter where Other income is placed the calculation is always the same

Or doe it mean one needs to create an Other Income Class which can then be placed after the COS

I will doe some experimenting

Thx

Gerrit

  • joe
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  • Registered: 03/15/2007
  • Posts: 5,107

Re: Income, Cost of Income and Other Income

If you want to present the GP for your sales, consider using the COS group as sub-group of the Main Sales group. And select the Sales class for this COS group. This would probably be the best way of solving this.  The other sales group could have their own stand alone group(s).
This is easy to switch forth and back if it doesn't fit. And no harm is done to the system.

/Joe

  • joe
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  • Registered: 03/15/2007
  • Posts: 5,107

Re: Income, Cost of Income and Other Income

Another solution would be to move the COS account into the same group as the Sales account, and maybe rename the group to Gross Profit.
You can try to se if this suits you.

/Joe