Can I play the radio at my retail store?

I’ve been told that satellite radio is the only way to have music at my store without having to directly pay a music organization and artist. It seems to me that the radio should be OK because there are commercials generating revenue. Does anyone know what the actual laws are in the US, and are there any ways to have music without having to pay some sort of subscription? Thanks to the responders.

with any "public" music broadcasting, you probably have to pay royalties. even music radio stations pay royalties to the music companies/artists – even iPods could get you in trouble – google "paying royalties for music broadcasting" or something similar

I am a marine dealer in Northern New England. What kind of retail business could I do in the wintertim?

P.S. I am a woman. I only employ mechanics March-October. The business must be something I can handle myself, and limited help. Some other source of revenue would help me remain solvent in the hard winter times. I am 34 and in very good shape, so some lifting is not out of the question.

If you have the space available, you could offer to winterize and store boats. Even if you don’t winterize them, storing them will bring in money. My brother-in-law does this in New Jersey. He doesn’t winterize, but he has field space for the boats to be stored and has several customers.

Dynamics Gp Consultant Newsflash: Importing Into Great Plains

If you have Dynamics GP or former Great Plains Dynamics eEnterprise implemented in your organization there is a good idea to understand your options to add such things as EDI, ongoing integration or one time data conversion.  Dynamics GP has multiple data import and export options and in this small publication we would like to give you initial GP integration highlights:

1.       Dynamics GP Integration Manager.  This tool is really great and you can setup the integration simply by reading IM user manual.  It integrates text files: CSV, Tab and special character delimited.  Also, you can get advantage of more flexible ODBC data sources integration, where you can deploy such ODBC compliant constructions as SQL Views, including cross-platform: Oracle, Lotus Notes, Pervasive SQL, Ctree, Microsoft Access, Excel, PHP mySQL (including bridges to Linux or Unix) to give you the idea.  Plus, IM allows you to alter integration logic in VBA scripts: before integration, before document commit, and other execution points.  You may say, that it is all great, the only problem for you is ERP implementation and support budget (especially now in 2009, when we are supposed to be in deep recession) – Integration Manager doesn’t come free with GP purchase (however Dynamics GP Business Ready license gives you, at least now the IM conversion license – this is temporary license, assuming that you need few month to conversion legacy accounting and MRP data to Dynamics GP Great Plains)

2.       Dynamics GP Macros.  This technique is a bit creative and not necessary known to every Dynamics GP programmer or consultant.  Macros work even if you have add-ons, or third party Dynamics GP ISV partners customizations.  The idea of macro deployment is simple and straightforward: open the window of the object to be integrated (customer maintenance for instance) and start recording macro in Tools->Macro->Record.  Enter manually two new customers and then stop playing macro.  Look at the macro file, open Excel file with your customers (coming from legacy system: PeachTree, MYOB, QuickBooks, Lotus Notes Domino) and add macro commands as Excel columns (in between your customer related fields).  Then save your Excel file in text format and give the new text file macro extension.  Now you are ready to play macro.  Macro playing requires computer session dedication – do not try to switch to another application while macro is in progress – simply take lunch or cup of coffee

3.       eConnect programming.  If you are on Dynamics GP 10.0 or 9.0, and if you classify yourself as Microsoft Visual Studio C# or VB.Net programmer with good skills in SQL and XML, then you can program integration on your own.  eConnect is especially great tool for ecommerce programmer, who needs to expose Dynamics GP as back end ERP for ecommerce application

Andrew Karasev
http://www.articlesbase.com/software-articles/dynamics-gp-consultant-newsflash-importing-into-great-plains-749051.html

SEO Experts and SEO Consultants, How They Help Your Business Succeed Online

You have set up your business website and then sat back to watch as customers come knocking on your door, but unfortunately not much has happened. When you try to use keywords that you think you deserve you are still finding the other guys website popping up in those top 3 spots. This is an unfortunately situation that is constantly happening for millions of web site owners. What is happening you may ask yourself. It may be difficult for you to understand now because you are not involved in the field of search engine optimization. However talented SEO experts and SEO consultants out there have a solid understanding of what is happening, and it is pretty simply to the experts. They seem to have a way with websites!

SEO consultants carry out a number of activities to ensure that your site is ranked highly by the search engines. These SEO experts work on a wide range of sites from static sites to dynamic ecommerce sites, lead generation websites and other online portals that are driven by database. They will charge you a fee for their services, either to perform the work of getting you to the top or else for the advice to get you to the top. Often times paying SEO consultants for their services is one of the best investment’s a small business can make that will actually help you reap healthy rewards. However, don’t be carried away by SEO experts who promise you everything and a sack of gold with your site. It is not automatic that you will receive the top ranking once they optimize your site. There are millions of web site owners out there trying to get their website to the top as well. Doing almost the same thing as you and competing for the same top ranking. But this should not dampen your spirit because there are people out there that understand the secrets to success.

I advise that you shop around for the best company or person and have them optimize your site and create a link building campaign to fit your needs. The reason you need links to your web site is simple, you need to confirm to the search engines that you are a relevant source of information for your web sites topic. You may not jump immediately in the search engine rankings, but with time your rankings should improve as the SEO consultants perform the work to get your website to the top. They will often times continue adjusting your webs site to fit the changing standards of the various search engines. Patience is definitely a virtue in working in this area.

You can also register for some training to learn more about search engine optimization. This will enable you to work on your site personally to improve your search rankings. As mentioned before the standards keep on changing, therefore you must keep on investing time or else you need to hire a company that stays up to date on the latest changes. To cut down the long term costs associated with this service, it is important to make that one time investment and get the training or purchase the services. Being trained in this field isn’t always the best option for everybody. Business men and entrepreneurs may not have the time to optimize their sites on their own. The option here is to hire the services of talented SEO consultants to work on their sites.

This will ensure that your able to obtain the traffic that is needed to sustain growth and obtain customers. Most customers interested in SEO services are businesses and retail stores that want to expand their place of sale.

Hiring the services of SEO consultants is a cost that has to be part of the daily running of your business. Just like paying your bills, hiring the services of SEO experts is an operating cost for any business that offers its services or products online. The fees you pay depends on the SEO expert services you are using as well as what the expert believes they are worth. I recommend price is considered, but you must also determine who can actually prove that they will be able to provide the results you are looking for. The greater the reputation of a SEO provider, often times the higher the fees. However there are still talented firms that are affordable and ready to help.

Joel Mclaughlin
http://www.articlesbase.com/internet-articles/seo-experts-and-seo-consultants-how-they-help-your-business-succeed-online-696979.html

Framedart-to-go.com Hires Cornerstone Consulting for E-commerce Website Development

Cornerstone Consulting Inc., announces the launch of a new and exciting website for FramedArt-To-Go™ at http://www.FramedArt-To-Go.com. This innovative e-commerce website concept provides a more efficient way for online consumers to purchase quality matted and framed artwork at discounted prices. The site was designed with integrated accounting, inventory, e-commerce and internet technologies to facilitate real-time order status information, instantaneous viewing of tracking numbers, secure SSL encrypted transactions and much more. By implementing a streamlined accounting, inventory and e-commerce solution, the employees of FramedArt-To-Go.com easily maintain: accurate sales forecasting, appropriate inventory levels, a lean business operation, sufficient company resources, customer loyalty and increased revenue generation.

“The launch of the FramedArt-To-Go.com website is exhilarating,” says David Boos, President of Cornerstone Consulting, Inc. “The website represents our on-going commitment to enabling our clients to employ efficient, streamlined and integrated information technology products and services. Providing FramedArt-To-Go.com with an integrated accounting, inventory and e-commerce software system is extremely rewarding. In this difficult economic period, many can no longer afford to waste time and resources by using inefficient, non-integrated software applications in the conduct of their businesses.” He added, “We are resellers and implementation specialists of an integrated accounting, e-commerce and inventory management software solution called Comgine (http://www.Comgine.com ). We’ve recommended this streamlined solution to ensure that our clients maintain: accurate sales forecasting, appropriate inventory levels, a lean business operation, availability of company resources, customer loyalty and increased revenues.”

Comgine reduces transaction costs, streamlines the online ordering processes and generates additional profits from web store sales. When items are purchased through an integrated e-commerce website, as opposed to a non-integrated website, pertinent information is processed through the accounting and inventory management software without any duplication of data entry. An integrated system is efficient: the order comes in from the website; the system fulfills the order from stock and orders replacement inventory from vendor; a payable is created; the picking/packing ticket is created; the product is shipped; the web payment is applied to order/ invoice; and, paid invoice and tracking information is automatically emailed to the customer. Mr. Boos stated, “We believe that it is our duty to deliver exceptional business management products and customer service to all clients. The continued success of our business model, which includes our continually growing e-commerce website development division, is a direct reflection of the quality of our skilled employees and technologically savvy clients.”

Capitalizing on over twenty-five years of technology consulting, implementation of ERP systems, custom programming and maintaining extensive business relationships with thousands of clients, Cornerstone Consulting focuses on making streamlined business management software and technology process improvements an enjoyable experience for their clients. Many business leaders embraced the concept of implementing integrated accounting, e-commerce and inventory management software systems to streamline business processes, reduce overhead and improve efficiencies. As a result of those successes, Cornerstone Consulting has become the leading reseller and implementation specialists for Comgine e-commerce software. Numerous industry leading manufacturers, distributors, pharmaceutical and nutraceutical companies leverage Comgine e-commerce software not only to sell goods to online consumers, but also to make their organizations more efficient.

Mr. Boos stated: “Even though we are primarily considered ERP consultants, Sage Software and SAP Business One implementation specialists and custom (SQL, .NET, ColdFusion, Visual FoxPro and more) programming experts, we have become a leading provider of integrated accounting, inventory and e-commerce software applications to small and midsized enterprises. In conjunction with our corporate mission, our goal is to help clients leverage technology to their competitive advantage. To achieve that objective, we hire exceptional programmers, technical writers, graphic designers, e-commerce website developers and project managers. Cornerstone employs only the most talented and technologically advanced people so that our team consistently delivers preeminent business software solutions and services for our clients.  Further, we thrive on distinguishing ourselves from the competition by embracing constructive change. Transforming the technological infrastructure of our core business to meet and exceed the expectations of our clients reinforces our reputation of excellence.”

About FramedArt-To-Go.com: In 2008, FramedArt-To-Go.com was formed to offer to the online community the same fine artwork that has been available to hundreds of thousands of satisfied buyers through numerous retail outlets across the entire United States. FramedArt-To-Go.com is a privately owned company that offers a diverse selection of framed artwork, as well as high quality Giclee, at substantially discounted prices to the online marketplace. The large inventory of art includes abstract, architecture, coastal, cuisine, floral, still life, landscape, nature, sports, leisure and wildlife framed prints. To make the online art shopping experience convenient for consumers, FramedArt-To-Go.com has taken the guesswork out of matting and framing. The quality artwork available at FramedArt-To-Go.com is matted, framed and shipped directly to the homes and offices of online consumers. For further information about the company, please visit the company’s website.

About Cornerstone Consulting, Inc.:
Cornerstone Consulting Inc. is a reseller of Comgine’s integrated e-commerce applications and a leading provider of Sage Software and SAP Business One business management software solutions to small and mid-market organizations. Founded in 1983, Cornerstone is a privately-owned company that provides a full suite of information technology for numerous small and mid-sized business clients in North America, Europe, South America, the Caribbean and Canada. Cornerstone provides clients with the ability to make faster business decisions, experience profitable growth and outperform the competition through the use of integrated, unified, streamlined, simple-to-use, scalable and customizable software. Our products and services support accounting, operations, customer relationship management, human resources, and a variety of specific needs of the wholesale distribution, pharmaceutical, nutraceutical and manufacturing industries. Cornerstone’s services include: system integration for LAN, WAN, VPN, wireless and Internet networks, Custom Programming, EDI, Barcodes and Scanning, RFID, E-commerce, Website Design and Hosting, Security, Networks, Remote Monitoring, VOIP and Custom Web Application Development. Headquartered in Tampa, FL at 5550 West Executive Drive., Suite 240, Vice President, Eleanor Mullaney can be reached at (813) 321-1300. For further information about our company, please visit the company’s website: http://www.Cornerstone1.com

Eleanor Mullaney
http://www.articlesbase.com/ecommerce-articles/framedarttogocom-hires-cornerstone-consulting-for-ecommerce-website-development-734469.html

Emerging Trends in Retail Marketing strategy

Emerging Trends in Retail Marketing strategy

 

Retail Marketing

            The essence of retail marketing is developing merchandise and services that satisfy specific needs of customers, and supplying them at prices that will yield profits. Thereby the concept is a philosophy, not a system of retailing or retail structure. In today’s CRM landscape the old analogy comparing the rifle and shotgun approaches to message and / or offer delivery is perhaps more appropriate than ever, as more retail organizations struggle to achieve one-to-one marketing-communications with customers and prospects.

            Targeting allows a retail enterprise to channel its marketing budget4ere there is the greatest (and fastest) possibility of Return On Investment (ROI)

 

Retail Marketing mix

            Retail Marketing mix is the term used to describe the various elements and methods required to formulate and execute retail marketing strategy.

            The mix may vary greatly according to the type of market the retailer is  in, and the type of products / services.

 

Marketing strategy

       A marketing strategy is a process that can allow an organization to concentrate its
limited resources on the greatest opportunities to increase sales and achieve a sustainable competitive advantage’. A marketing strategy should be centred around the key concept
/ that customer satisfaction is the main goal.

            A strategy consists of a well thought out series of tactics to make a marketing plan more effective. Marketing strategies serve as the fundamental underpinning of marketing plans designed to fill market needs and reach marketing. Plans and objectives are generally tested for measurable results.

 

 

Today’s retail Marketing Managers Must :

            Understand the connections between the lifestyle and expenditure characteristics of customers, their propensity to purchase one product or brand over another, and leverage this understanding for competitive advantage.

            Improve direct marketing response by ensuring they are targeting the right households at the right time, using the right media with the right message.

            Leverage current consumer data to make better strategic decisions about products, marketing and locations.

            Increase customer loyalty and retention with a scientific, data driven approach to analytical CRM.

            Retail marketing managers can implement the following projects to understand their customer, market and store locations better; achieving a very strong ROI for their retail marketing efforts in the process.

 

Customer and Market Potential Estimates:

            Estimate the revenue potential of your customers to determine their current, potential and life-time value

            •      Estimate your market potential for more effective acquisition initiatives

            •      Quantity and qualify your market opportunities.

 

Customer and Market Profiles:

            •      Develop more effective communication strategies through a better understanding
                    of who your customers are

            •      Identify your market potential through a better understanding of your targets.

 

Customer and Market Segmentation:

            •      Develop more effective communication strategies through a better  understanding
                    of different customer groups and your market segments

            •      Customize your product offers by different customer and market segments.

 

 

The nature of retail Marketing:

  • The key aspects of retail marketing is an attitude of mind.
  • In making retail marketing decisions, retailers must consider the needs of the customers.
  • Retail marketing decisions are driven by what the shoppers need and want.
  • Retail marketing is therefore a philosophy and is all about satisfying the customers
  • What the customers regard as value and what they buy is decisive.
  • What the customers buy determines the nature of the retailer’s business.
  • The essence of retail marketing is developing merchandise and services that satisfy
             specific needs of customers, and supplying them at prices that will yield profits.
  • Retailers must take the customers’ needs into consideration in retail operation.
  • Retail marketing is stimulating, quick-paced, and influential.
  • The retail marketing concept is the acceptance by the retailer that it is the “customer”
             and not “demand” that lie at the core of the retail organization.

 

The Emerging Sectors:

            Retailing, one of the largest sectors in the world economy, is going through a transition phase, not only in India but the world over. For the long time, the corner general store was the only choice available to the customer, especially in the urban areas. This is slowly giving way to global format of retailing.

            The emergence of new retail sector have accomplished by changes in existing formats as well as the beginning of new formats.

 

The changing Retail Environment:

            Profound changes are taking place, and will continue to occur, in the retail industry. In terms of sales, the retail landscape is moving away from specialty stores and department stores toward discount retailing.

            Although the future is difficult to predict, forthcoming trends in retailing will focus on demographics, geographic convenience, time convenience increased food expenditure away from home and rapid changes in information technology. In addition, retailers will find a convergence of electronic methods and traditional methods of Retailing.

 

 

Five pillars of Retailing:

            Heoxard Berry describes five important actions for Retailers. These actions, demand pillars, sound simple but are often difficult to implement.

  1. Solve customer’s problems.
  2. Treat customers with respect.
  3. Connect with customer emotions.
  4. Set the fairest (not the lowest) price.
  5. Save customer’s time.

            Retailers should always keep these pillars in mind when conducting business. As the work force becomes more diverse and the retail environment continues to changes, consumer’s needs are rapidly changing.

 

Retailer’s Responses To the changing customer:                                   

            Retailers will need to alter their way of thinking to adjust to the changing customer.

v                 Retailers that convey the appropriate level of respect will experience an increase in customer loyalty and sales.

v                 Retailers must dig deep to learn who their customers are, so they can develop Niable customer segments.

v                 The old marketing concept will need to be modified from “satisfying” customers to “wowing” customers.

 

Global retailing:

            The world has entered the digital information age. Retailers in a variety of industries are now using advanced computer systems to enhance their ability to understand, communicate with and evaluate their market place and to anticipate and respond to their customer’s needs, Retail shops are using bar code scanners at their check out point to gauge the types of product their customers are buying.

 

 

E-tailing:

            Retailing on the net is known as E- tailing. Internet has changed the way we do shopping. It has brought the commerce will play a crucial role in shaping the future of Indian retailing. The real challenge for retailing would be laurching and managing a highly irnovative click business that works along with a more stable bricks business. For shoppers and retainers it is increasingly a hybrid world.

            Merchants that reach consumers through different sales channels, stores, websites catalogues, find that they enjoy key advantages over competitors that operate in just one world. E-tailing is still a nascent business model all over the world and it is to be seen how it emerges in the future. E-tailing will also work best as an adjunct and supplement to brick and mortar set up.

            On the flip side, retail stores can make consumers more comfortable with internet shopping since most traditional merchants allows customers to return on-line purchase to their offline stores.

 

E-commerce in Retail marketing:  

            “With Electronic – commerce, we have reached the flash point” – says Ferguson. The internet throws many exiting trends under an are light and accelerates the transformation to web years. There is an occupational hazard in the world of electronic commerce. There is an existing and confusing time. In some ways electronic commerce has already had profound impact – just the Wall Street brokers who have been watching their private clients flock to online discount brokers.

 

Retailing in India – Trends and Opportunities:

            Retailing – no marks for guessing this is the most active and attractive sector of the last decade in India. While the Retailing industry itself has been present through history in our country, it is only the recent past that has witnessed hordes of players leaping onto it.

            The Emergence of Retailing in India has more to do with the increasing purchasing power buyers, esplically post- liberalization increases in product variety and the increasing economies of scale with the aid of modern supply and distribution management solutions.

            The current retailing revolution has been provided an impetus from multiple sources. The “Revolutionaries” include many commotional stores upending themselves to modern Retailing, compainces in competitive environment entering the market directly to ensure exclusive risibility for their products and professional chain stores coming up to meet the need of manufacturers. Attractiveness, accessibility and absorbability seen to be the key offering of the Retailing chain.

 

Emerging Trends:

            The single most important evolution that took place along with the Retailing evolution was the rise and fall of the dotcom companies, more importantly, the very nature of the customer segment being addressed was almost the same. The computer – Sawy individual was also a scale- sector of the store.

            Internationally, the concept of net shopping is yet to be proven. Now ever, the size of the direct market industry is too limited to deter the Retailers, for all comenience that it offers, electronic retailing does not suit products where “look” and “see” attributes are of importance.

 

Retail Strategy:

            According to the wheel of retailing theory, retail innovators often appear as low – price operators with a low-most structure and low-profit margin requirements. Over time, these innovators upgrade the products and become high price orators. This meant enlarging the sales force, improving locations, upgrading fixtures, carrying lower thrower merchandise and granting credit etc… These improvements lead to higher cost which tern lead to higher prices.

 

Retail image:

            Image refers to how a retailer is perceived by customers and others succeed, a firm must communicate a distinctive, clear and consistent image. Once its image is established in consumer mind, a retailer is placed in a riche relative to competitors.

 

 

Future of Retail in India :

            Customers are also looking for convenience in shopping. This would continue more strongly in the next couple of years. In future the more dual income families, the consumer’s ability to spend will increase, but at the same time it is predicted that the time available for shopping will go down, in such scenario, the retailers will have to take steps to develop shopping as an experience, though the more successful retailers will be those that will provide faster service.

            Thereby to succeed in retailing, current and future retailers must be able to adopt a constantly changing environment, successfully retailers are able to anticipate and adapt to change.

            Thus retail marketing strategy would not only yield benefits for consumers. Manufacturers and wholesalers but also creates economic utility.

 

 

 

Conclusion:

            Retailing is a technology – intensive industry successful retailers today work closely with their renders to predict consumer demand, shorter lead times, reduce inventory holding and thereby save cost.

            Wale-mart pioneered the concept of building a competitive advantage through distribution and information systems in the Retailing industry.

            The traditional Retailers will always continue to exit but organized retailers are working towards revamping their business to obtain strategic advantages at various levels – market, cost, knowledge and customer.  

            It would be important to note, however that the retailing industry in India is still a “protected industry”. Given the current trend in liberalization, it will not the long before the Retailing sector also thrown open to international market. This will see a further segregation of international retailing brands.  

 

 

Author : C. PAVITHIRA

            M.Phil Commerce,Periyar university, Salem-11

 

Address for Communication :

            57, Appasamy Street,

            Shevapet, SALEM – 2.

            Cell : 98425 – 50487

E-mail:  pavithira01@yahoo.co.in

 

C.Pavithira

Understanding the Income Statement (the Typical Explaination)

The following document is a standard teaching document. You will find it anytime you either ask or research for yourself, the answer to the question, “What is an Income Statement”.

I have made my own notes that point out basic problems in this document and the problems that are taught to new business owners, “right out of the gate”.  (Understand that I am not saying this document is WRONG. What I am saying, is that while it attempts to teach, its complexity and lack of insight into the reader perspective, creates more confusion then it needs to)

One of the Fundamental Principles of accounting is that revenue and the expenses necessary to earn this Revenue should be as accurate (as nearly as possible) when preparing reports (Income statement and Balance Sheets) for management regarding the results of the operations for a given time period, (month/year). Without accurate data, and records, sound financial decisions are not possible.

The Income Statement (a.k.a. Profit and Loss Statement) is usually prepared on the same date as the Balance Sheet; however, unlike the Balance Sheet, the Income statement does not provide information which is “frozen” for one moment in time.  It presents information for activities, which have occurred over a period of time. The Income Statement is sometimes called the Profit and Loss Statement (P & L Statement) because it traces a company’s profits or losses over a period of time – usually one (1) year. The income statement is an exhibit of a basic business equation:

REVENUES minus COST and the associated EXPENSE equals NET INCOME (or Loss).

(This mathematical formula is taught to us all in business and is fundamentally flawed.  I hate that this is the math foundation that all business operates on.  You start out WRONG and generally, finish WRONG and you never know why.  Watch for my next article and you will find out WHY this math is WRONG!!!!!)

The Income Statement is traditionally organized into four (4) major categories of information:

1)   Revenues (Sales or Net Sales)

2)   Costs and Expenses (Operating Expenses)

These are usually presented as:

Cost of Goods Sold (COGS) or Cost of Sales

Operating Expenses

The Operating Expenses may be further sub-divided into:

Selling Costs and any other meaningful grouping, and General and Administrative Expenses (G & A)

3)   Tax on Income (Federal and / or State Taxes)

4)   Net Income for the Month/Year 

(There are 5 key points on any income statement and in order to, CONTROL YOUR OWN DESTINY, YOU MUST KNOW WHAT THEY ARE AND HOW TO MANAGE THEM!!!!)

The normal composition of an Income Statement lists all of the above for a one (1) month period, providing management an immediate insight into the total business activities of their company for a one (1) month period of time.  The statement normally lists year-to-date (YTD) figures as well.  YTD figures are a compilation of all figures for preceding months plus the current month.  This gives management an insight into the total business activities of their company over an extended period of time. (Normally 12 month or less.)

REVENUES (SALES or NET SALES): This section lists all money received by the company during the income statement period from the sale of products or services, or from other revenue sources.  The company may have any number of categories listed separately under the REVENUE (SALES) section of the Income Statement.

COST AND EXPENSES (OPERATING EXPENSES): Normally the first listing under the COST AND EXPENSE section of the Income Statement is “Cost of Goods Sold” (COGS) or “Cost of Sales” (COS) depending on the particular operation; Manufacturing or Retail sales etc. This listing is usually the largest single expense item on the Income Statement and it should include all costs except General and Administrative costs.(Specifically, tracking how much you spent on material and labor, to produce a product or service that is ready to sell)

COGS / COS “Cost of Sales” may be divided into “Direct” and “Indirect”.  It should include all expenses that are directly attributable to the production or purchase of goods which are sold and services rendered, i.e., labor costs including taxes, contract labor, rental equipment, vehicles and associated expenses, freight, etc.

GENERAL AND ADMINISTRATIVE EXPENSES [G & A]:  These expenses include salaries and labor costs of all employees not in “Cost of Sales”, the cost of office operation, rent, insurance and all other GENERAL costs required for the operation and management of the company that ARE NOT assignable to services rendered, production or sale of goods.  The company may have any number of individual categories listed under this section. 

DEPRECIATION EXPENSE:  There are numerous depreciation schedules and policies, i.e., straight line, declining balance, accelerated method, etc.    The company should use the depreciation method that most realistically reflects the decline in service potential of the assets and that results in the best earnings quality.  Management should discuss the various depreciation schedules now being used with the company Certified Public Account (CPA).

INTEREST EXPENSE:  This expense is the annual cost of financing the company through borrowed funds.

The Income Statement figure for TOTAL COST AND EXPENSES is a total of the entries for:

Cost of Sales (Direct and Indirect)

General and Administrative Expenses

Depreciation Expense

Interest Expense

TOTAL COST AND EXPENSES are DEDUCTED from TOTAL REVENUES.

The result is called Income Before Taxes or OPERATING PROFIT (LOSS).

TAXES ON INCOME:  Income taxes and other types of taxes are listed on the Balance Sheet as a Current Liability.  The Balance Sheet shows the total of all types of taxes owed as of the Balance sheet Date.  The amount shown is usually less than the total tax expenses for the year.  This is because taxes are normally paid in installments as the year progresses.  Some taxes have already been paid during the year prior to the Balance Sheet Date and the amount shown on the Balance Sheet will probably be paid in installments after the Balance Sheet date.

The actual expense of taxes paid during the year is shown on the Income Statement.  Some types of taxes are included in the figures for Selling Expense and General and Administrative expense.  The Income Taxes paid during the year are shown separately. On the Income Statement they are listed in a separate section called Taxes on Income.

Depending on how the company wishes to set up its Income Statement the next entry may be OTHER INCOME AND EXPENSE.  This category may be made up of such items as Bad Debt Recovery, provision for Income Taxes, Interest Income, Gain/Loss on Sale of Assets, etc.  The total of all items in this category are then added or deducted, whichever the case may be to/from the INCOME BEFORE TAXES  (Operating Profit (Loss)) figure. The result is NET INCOME for the year.

NET INCOME FOR THE YEAR is the most important item of financial information on the Income Statement.  It is the key measure of the company’s performance.  The amount of profit achieved after all costs, expenses and taxes has been paid from revenues.

After reading this document. ask your self , “Dis this document help?” Probably not.  Especially if you are just starting out in business and have no financial training.

Keep in mind that the above layout and description for an income statement is what is referred to as “TAXED BASED ACCOUNTING”. I will discuss this type of accounting in later articles.

Remember where, “MY”, focus is. The small b
usiness owner.  They are this country’s life blood. They are the ones that ensure our future.  This I state again because, “you must communicate at a level that accomplishes your goal and objective”. 

I remember once attending a meeting where the speaker had a PhD in Business.  At the end of the long and very boring meeting every person in the room was confused and a tad bit angry.  Angry because of the money that was spent on this speaker and at the unusable information that was conveyed.   The truth was, the speaker did convey valuable information on strategic planning, but had no idea how to convey this information to people responsible for its implementation.  The speaker detected this uneasy feeling in the room, but instead of recognizing it for what it really was, stated to me, “these people act as if they just came out of a garage with this business!”  Reality, they were only out of their garage for 2 years, knew nothing of business planning, of managed growth, and absolutely knew nothing about financial management.  This speaker was retained to enlighten the team, instead he was speaking as if he were in a classroom of graduate students.

If your goal is to teach or train, you must communicate at a level that can be understood and actually utilized. 

My point, know your audience and speak to them, not at them.

This applies to any industry. For example, if a PhD in Social Work speaks to an offender as a PhD, how much impact on this person’s life, will they really have?

This therefore, is the problem with this training document……………

My next several articles will explain the income statement in terms that anyone can easily understand and apply, no matter your background or your operating business entity.

Marvin Jackson
http://www.articlesbase.com/management-articles/understanding-the-income-statement-the-typical-explaination-720654.html