Stock Profitability Report
Stock profitability report shows the profit and loss of stock items over a selected date range. Records and information will be display based on the date range selected by the user. The profit you acquired will be based on the difference between the cost of goods purchased and the cost of goods sold. This report will be able to help you keep track of your profit gained and assist you to make a better decision on the stock purchase based on the liquidity of each product.
To check your Stock Profitability Report in TreezSoft, navigate through Stock > Reports > Stock Profitability
You will land on the screen below:
- Select the date range of the reporting period that you want to generate.
- Click "Retrieve".
TreezSoft system will generate the full stock profitability report based on the range of selected dates. The profit you make will be displayed on the second last and last column on the right. If you are making a profit, the number shows are in default black color while losses will be displayed in red.
Possible Reasons for Losses
1. Purchase price > sales price.
Your purchase price is higher than the sales price. Profit will only be made when you are earning more than what you paid. This can be fixed by changing the selling price of your goods in Stock Item.
2. Have sales but no purchase.
Having sales that do not necessarily mean that you are profiting from it. Sales come in when a customer made an order, but you will only earn profit from it when you actually deliver the goods to your customer and the customer pays for it. In order to complete the process, you will need to purchase the stock from your supplier, deliver it to the customer, and received payment from the customer. Always make sure that you have some ready stocks in your company to complete the customer's sales orders much faster and issue an invoice to the customer to keep track of their payment.
3. Unit of measurements of the purchase or sales is not provided or entered wrongly.
In TreezSoft, you can set different units of measurements (UOM) for your stocks to fit your business needs. If the UOM of a stock item is not set or entered incorrectly in a transaction, it will affect the calculation of profit earned at the end of the day. You will need to make sure your UOM is set correctly.
4. Unit of measurements conversion set up wrongly.
Setting an incorrect conversion between units of measurements (UOM) on your stock item is also another reason for sales loss in your stock profitability report. Same to the reason mentioned in the previous paragraph, you will need to make sure your conversion was set correctly.
Conclusion
An accounting error sometimes happens. These errors could cause big troubles to businesses as they will lose sight and control over their business financial's well being. It's best to be aware of these common errors and once you spotted the mistake, taking immediate action is the best solution.
You can visit these links to read more about stock modules in TreezSoft:
TreezSoft is a cloud accounting software for Small and Medium-sized Enterprises (SMEs). It allows you to access your financial information anytime, anywhere. It also allows you to have unlimited users for FREE for your account in TreezSoft. Our aim is to help reduce our clients' time spent on accounting mainly by using our automated processes and integration to help increase their company efficiency at a minimum cost. SMEs can use TreezSoft to keep track of their expenses, accounts, daily operation e.g. Point of Sales (namely QPOS) system and etc.
Visit TreezSoft at http://www.treezsoft.com/ to sign up for a 30 days trial account with us!
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