To understand what is income, profit and revenue in the economy, it is necessary to study a lot of specialized literature.

This knowledge should be possessed not only by an accountant or financial analyst, but by every entrepreneur.

This will allow you to organize a successful and profitable business.

Definition of income

Income is the difference between the money received and the material costs. In other words, it is defined as a combination of profit, as well as wages. Cash that was spent on the production of a certain type of product or on the provision of services is not taken into account.

It is divided into types of activities, as well as other income. Here, activities mean any services that the company provides, and any goods that it produces, that is, in the aggregate.

As for other options, here we are talking about receiving funds by renting out real estate.

How is it different from profit?

As for profit, it is indicated as the difference between the revenue received and all possible expenses of the company.

It is worth noting here that profit may or may not occur.

If after the expiration of the established period, the profit is less than the costs, then the company suffers significant losses.

To determine the net profit of the company, it is necessary to subtract the following values ​​from the revenue:

• the cost of purchasing materials needed for production;
• wages;
• income taxes.

At some points in its activity, the company decides to give up some part of the proceeds. The reason for this may be the output new market, competition with other firms, promotion of a new product and much more. In this case, we are talking about redirecting profits to solve certain problems.

difference from revenue

Many people know that revenue is cash received by the company as a result of its activities.

This includes the manufacture and sale of certain goods or the provision of certain services.

It can also be indirect income. In this case, we are talking about investment.

Note: if the investor decides to contribute additional money to the development of the company, then these funds will also be determined as proceeds.

In the life and work of an enterprise, this concept is defined somewhat differently, as indicated by theory. According to the latter, this money is received at the time of the sale of products or the provision of certain services. But this is not always the case. For example, payment for goods can be made in installments. This happens when it comes to buying in installments.

Another option is to purchase goods on credit. In this case, the funds are transferred to the company's account through a bank, which lends money to the buyer. Thus, you can see that the money raised can be varied. But, nevertheless, their essence does not change.

As you can see, revenue, profit and income are close and at the same time different concepts. Their difference must be understood by everyone who is going to do business.

Watch a video that explains what income is and how it differs from profit:

Profit and revenue are two different concepts, but they accompany the activities of any company constantly. Their meanings are quite close to each other, as they are often used in the same context. But there is a difference between them.

Revenue

The company's revenue is cash receipts from the sale of goods, services or work on the market. It represents the result of the activities of the entire company for a certain period of time. In another way, the revenue is called the gross income of the company.

Revenue is reflected in accounting on account 90 “Revenue”, is used to determine the amount of tax paid by companies operating on a simplified taxation regime.

Revenue is the most common measure of a company's performance. However, not everything can be considered revenue. As a rule, these are income from the main activity. When compiling the balance sheet, revenue is taken into account net of indirect taxes, in particular VAT, which is actually withheld from the buyer.

Revenue can be predicted. Based on the data of previous sales volumes and cash receipts, the accountant can predict the expected revenue in the next reporting period. The total revenue of the enterprise for reporting period consists of:

• Proceeds from core activities (sale of goods, provision of various services or performance of work);
• Revenue from investment activity (financial results from the sale of non-current assets or the sale of any securities that are owned by the company);
• Revenue from financial activities companies.

Profit

Profit is an important indicator of a company's performance. It is economic and accounting.

Economic profit - the difference between the total income of the enterprise and the costs (explicit and implicit). This indicator shows how efficiently the company worked in a certain period of time. Economic profit can be distributed among the founders. Accounting profit is profit used for accounting purposes. Taxes are deducted from it, and it is reflected in the Profit and Loss Statement. It is equal to the difference between the total income and the explicit costs of the enterprise.

The main profit of the organization consists of indicators:

• Profit (or loss) from the main activity (sales of products, provision of services or performance of work);
• Profit (or loss) from ancillary activities (for example, profit from renting a warehouse or performing additional work under a contract).

The relationship between profit and revenue is that profit is the difference between the total revenue and the total costs of the enterprise. Profit can be negative (loss), while revenue is not.

Based on the performance of past periods, the accountant can predict future profits. To make such a forecast, it is necessary to take into account not only expected income (future revenue), but also expected expenses, as well as market conditions and predicted changes in the market.

Many people do not fully understand what a company's profit and its revenue are, and what is the difference between these concepts, and if you look deeper, each of these terms has its own subterms: net profit and EBITDA, gross revenue.

Employees of economic specialties (state statistics officers or accountants), when publishing indicators and indicators, imply clearly defined definitions of each term.

They are specified in legislative acts full awareness of which is mandatory for such employees. But since the concepts of revenue and profitability are in the sphere of interests of numerous non-professionals, an understanding of the essence of the concepts discussed will be useful.

Revenue- the amount of money or other equivalents that the enterprise receives for a specified period of time of its operation, for the most part due to the sale of products or services.

Distinguish between revenue and income: the latter represents the revenue (turnover) minus the cost (or purchase price) of the product or service.

Revenue does not include increases in capital due to an increase in the value of the company's assets due to any factor. In the case of calculating the revenue of charitable organizations, it is calculated as the total amount of charitable cash injections received.

Revenue Formula

The revenue formula can be represented as follows:

Revenue = cost (or purchase price) + value added
Revenue = Realized Value * Number of Units Sold

According to the Regulation on Accounting under the number 9/99, revenue recognition occurs subject to the mandatory presence of the following criteria:

1. the company has the right to receive this proceeds (which follows from the subject contract);
2. total revenue can be determined;
3. there is confidence that that as a result of a certain transaction, an increase in the financial benefits of the enterprise will follow;
4. property rights(use and disposal, ownership) of the goods (products) passes from the enterprise to the client or the customer has accepted the work (service provided);
5. transaction costs, can be determined.

The total revenue of the enterprise for the reporting period consists of:

1. Operating revenue- the amount of money or other assets in monetary terms, received or to be received in the future as a result of the sale of products, the provision of services and services at prices, tariffs in accordance with contracts.
2. Revenue from investment activities.
3. Income from financial activities of the company.

The last two items are:

• financial receipts from shares in the capital of other companies, dividends, bonds and other securities;
• financial receipts from leasing;
• additional financial receipts due to the exchange rate delta on foreign currency accounts, transactions in foreign currencies;
• financial receipts from the revaluation of funds placed in securities, subsidiaries, and so on;
• royalties and capital transfers received;
• other financial receipts from financial activities.

Total revenue is made up of revenue from the above three areas, but mainly it consists of revenue from core activities, which, in general, is the whole point of the company's existence.

Profit- net income from business activities, reflected in monetary form, which is the delta of total revenues and total costs of the company.

Profit (or loss) of the company is a defining indicator that demonstrates the financial result.

The Regulation on Accounting under the number 4/99 sets out the process of profit formation and presents 5 of its main indicators:

• Pure(retained earnings);
• Profit from operating activities;
• Realization profit- delta of gross profit and distribution costs;
• Profit (or loss) before tax- is calculated according to the following scheme: operating income is added to the operating income and operating costs are subtracted, non-operating income is added to this total and non-operating costs are subtracted;
• — is equal to the delta of sales proceeds (net of VAT, excise duties and other obligatory payments) and the cost of goods sold (in the trade sector, the cost is equal to the purchase cost of the goods).

Profit formula

The main profit of the company consists of:

1) Profit (or loss) of the main activity- the fiscal result coming from the main activity of the company, it can proceed in the form of any forms and varieties, ratified in the company's charter and not contradicting legislative acts.

The fiscal result is formed separately according to each type of company activity related to the sale of products, the performance of work, the provision of services.

It is calculated as a delta of proceeds from the sale of products at current prices and the costs of their manufacture and sale.

Pr \u003d Bp - C / s ,

where bp- proceeds from the sale;
S/s- cost (expenses for production and sale).

Revenue is calculated excluding VAT and excise payments, which, being indirect taxes, go to the state budget. It also does not include allowances (discounts) provided to dealer and supply companies that participate in the sale of goods.

Export companies, when crediting profits, do not include export duties that go to the country's budget.

2) Profit (or loss) from ancillary activities- this includes the sale of assets, operating, non-operating and extraordinary income and expenses.

Companies can make a profit or loss that is not related to the sale of goods, works and services. It also includes profit or loss from other sales, namely from the sale of the property of the enterprise.

For example, a company may sell fixed assets or funds, intangible assets, materials, WIP, securities etc.

In addition to profits and losses from other sales (from the sale of property), enterprises still receive non-operating financial results that are not related to either the sale of goods or the sale of property.

The difference between profit and revenue

1. Count. Revenue, by definition, cannot be less than or equal to zero; if it is lower, then it means its complete absence. Unlike revenue, profit can be both positive and negative.
2. Structure. To calculate revenue, it is sufficient to determine the amount of all funds that an individual or legal entity received for a certain period of time. In the case of calculating profits, everything is much more complicated, because first you need to know the sum of all the funds received and the costs.
3. real expression. In the case of revenue, it may be "absentee", for example, if the company allows a deferred payment, allowing its customers to pay a little later. In the case of profit, such a calculation is inappropriate, because. it is calculated only upon the fact of settlement, when the money is either received in hand or in a bank account.
4. Expression. Revenue is a single-digit value, because it consists of the amount of income. In turn, profit can have several meanings - whether it is gross (total) or net (with mandatory payments paid).

Thus, it is necessary to distinguish between the concepts of revenue and profit, since they have different semantic and economic meanings.

To properly understand financial documents, you need to know what income is. This term denotes material values or money received as a result of activities for a certain time by an individual or legal entity, the state. Sources of income generation: exploitation land plots, breeding of farm animals, leasing objects, trade, production of goods or provision of services, rent, loan interest, wage, pension, scholarship, benefits, royalties, investment, royalties and more.

STS income

STS income- these are objects that are taken into account in the simplified taxation system - a special procedure for paying taxes, focused on representatives of small and medium-sized businesses. As an object, incomes or incomes reduced by the amount of expenses incurred (according to the “income minus expenses” scheme) are selected. Accounting for income is determined by Art. 346.15, 346.17 of the Tax Code of the Russian Federation. STS income - proceeds from the sale of goods, works, services and property rights. The income listed in Art. 251 of the Tax Code of the Russian Federation, are not included in income. Accounts payable written off at expiration limitation period is recognized as income.

Income tax

According to the legislation of the Russian Federation, income (profit) tax is levied on individuals and legal entities. Income tax payers are legal entities that have taxable income in the financial year. Payers of the single and fixed tax are exempted from its payment. Personal income tax (PIT) is defined as a percentage of total income minus documented expenses. For different categories of taxpayers and different types income legislation provides for various tax rates. The payment amount is determined by multiplying tax base on a bet.

Budget revenues

Budget revenues - funds received from the collection of taxes, duties, payments, foreign, foreign economic activity, from the sale of land, from the sale of state reserves, fixed capital and receipts from other sources. They are used for the implementation of state functions (legal, political, organizational, economic, social, environmental, cultural, educational). The material basis of budget revenues is the national income. The structure of budget revenues is subject to change and is determined by the current economic conditions.

income book

The main tax register for individual entrepreneurs is the book of income. The order of its maintenance is determined by the Order of the Ministry of Finance of Russia dated October 22, 2012 N 135n "On approval of the forms of the Book of accounting for income and expenses of organizations and individual entrepreneurs applying the simplified taxation system, Books of accounting for the income of individual entrepreneurs applying patent system taxation, and the Procedures for filling them out. "Taxpayers must ensure the completeness, continuity and reliability of the accounting of the data entered. The document reflects the date and content of the transaction, the amount of income and other information.

Revenue Accounting

Accounting for the income of companies is carried out in accordance with the order of the Ministry of Finance of the Russian Federation dated May 6, 1999 N 32n "On approval of the Regulations on accounting"Income of the organization" RAS 9/99", by order of the Ministry of Finance of the Russian Federation No. 86n, the Ministry of Taxes of the Russian Federation No. BG-3-04 / 430 of August 13, 2002 and Ch. 25 tax code RF. For various types of organizations and certain types of income, there are special procedures for calculating and accounting for income. Income accounting for individual entrepreneurs is carried out in the income book, and organizations - on accounting accounts 90 and 91. Penalties are provided for violation of income accounting by law. The rules for accounting for business transactions are determined by Section II of the procedure for accounting for income and expenses.

Declaration of income

According to the Law of the Russian Federation of December 7, 1991 "On income tax from individuals”, citizens of the country must annually submit to tax authorities at the place of residence income declaration. This is a written statement by the taxpayer about income, expenses, sources of income, tax benefits and the calculated amount of tax. The following are exempt from filing income tax returns:

• citizens who receive income during the reporting period at their main place of work;
• persons without permanent residence in the Russian Federation;
• individuals whose total income does not exceed the amount taxed at the minimum rate.

Types of income

Companies, entrepreneurs, individuals receive different types of income from different sources. For these types, the taxation procedure and tax rates differ, so you need to know the main types of income:

1. Factorial:

• from natural resources- rent (land, mining, payment for water);
• from labor resources- wage;
• from capital - interest and profit;
• from entrepreneurial abilities - entrepreneurial income;
• from knowledge - income from intellectual property.

2. Non-factorial - all the rest, not related to the production process, such as subsidies, sponsorship.

Income information

In accordance with the Federal Law of December 25, 2008 No. 273-FZ "On Combating Corruption" and the Decree of the President Russian Federation dated May 18, 2009 No. 559 “On the submission by citizens applying for positions in the federal civil service and federal civil servants of information on income, property and property obligations”, citizens working for public service, submit information on income, expenses, property and obligations in the approved form of a certificate. This information is considered confidential. The procedure for its provision was approved by the order of Rosfinmonitoring dated November 21, 2013 No. 326.

per capita income

Per capita income is calculated from national income divided by population. This is an important indicator of the economic well-being of the country and its citizens. It measures the average income received by a resident of the state per year. Based on it, various ratings, dynamics economic development countries. The weak side of this indicator is the lack of accounting for disproportions in the distribution of funds between different segments of the population. For cross-national comparisons, the indicator is recalculated in the international currency - in dollars. For a more accurate assessment economic situation citizens use the purchasing power indicator.

Non-tax income

In addition to revenues from the system of taxation of individuals and legal entities, the state receives non-tax revenues. These include receipts in the form of fees for the use of state property or for services rendered by the state (fees for the use of state funds, for the development and extraction of minerals, from the sale of property owned by the state, various fees for state verification of measures and measuring instruments, for the registration of trademarks ), as well as income from state-owned enterprises, issuance of government loans, from money emission and other types of income.

Passive income

Passive income is received from sources not related to daily activities (work, entrepreneurship). It is taxed at rates different from those of other types of income. Typically, taxes on such income are paid once a year. Main sources of passive income:

• lease of property (buildings, Vehicle, equipment);
• copyright (publication of literary works, the right to show films, broadcast music, use patents and inventions);
• bank deposits;
• securities (shares, bonds).

How is income different from profit?

To properly understand economics, it is important to know the difference between income and profit. Income is the receipt of funds for a certain period of time. Profit is income minus the costs of obtaining it (for example, for the manufacture and sale of goods, depreciation of means of production, public utilities And so on). There is also such a thing as net profit. To calculate it, you need to deduct taxes and mandatory payments from profits. Profit reflects the financial result of the activity. For businesses, this is an important indicator of business success. Profit is always less than income.