Net earnings

It is possible for some projects to reach a stage at which repairs, replacements, etc., can exceed net earnings in a particular year. In this case the cumulative-discounted-cash-flow or net-present-value curve plotted against time has a genuine maximum. 

B = net earnings after taxes (50%) per annum for the coming period in which the investment should be payed back ... 

Net earnings in first year (after taxes) = 50% of 1.25 million... 

The maximum contributions under a Keough Plan are substantially higher than under an individual retirement account. The contribution limitations are the lesser of 15% of earned income or 7500. Earned income for contribution purposes does not include wages, salaries, dividends, or interest. Earned income includes only net earnings from self-employment. 

Table 5.1. SYSCO compound annual growth rates of sales and net earnings (%)...

Limiting the financial metrics is a key ingredient in energizing a company for change. Corporations tend to focus on net earnings (per share), EBIT, sales growth, and market share. Financial sponsors, on the other hand, use a value-... 

With the tax deducted from the PBT, the net profit, net earnings or profit after tax (PAT) is determined, to be the prime source of real income for the project, but not the only one. 

Expenses, as outlined in Chap. 8, for various types of taxes and insurance can materially affect the economic situation for any industrial process. Because modem taxes may amount to a major portion of a manufacturing firm s net earnings, it is essential that the chemical engineer be conversant with the fundamentals of taxation. For example, income taxes apply differently to projects with different proportions of fixed and working capital. Profitability, therefore, should be based on income after taxes. Insurance costs, on the other hand, are normally only a small part of the total operational expenditure of an industrial enterprise however, before any operation can be carried out on a sound economic basis, it is necessary to determine the insurance requirements to provide adequate coverage against unpredictable emergencies or developments. 

Figure 6-3 gives a graphical analysis of the effect on costs and profits when the rate of production varies. As indicated in this figure, the fixed costs remain constant and the total product cost increases as the rate of production increases. The point where the total product cost equals the total income is known as the break-even point. Under the conditions shown in Fig. 6-3, an ideal production rate for this chemical processing plant would be approximately 450,000 kg/month, because this represents the point of maximum net earnings. 

It has been proposed that a company invest 1 million in a venture which will yield a gross income of 1 million per year. The total annual costs will be 800,000 per year including interest on the total investment at an annual rate of 8 percent. In an alternate proposal, the company can invest a total of 600,000 and receive annual net earnings (before income taxes) of 220,000 from the venture. In this case, the net earnings were determined on the basis of no interest costs. The company has 1 million of its own which it wishes to invest, and it can always obtain an effective 6 percent annual interest rate by loaning out the money. What would be the most profitable way for the company to invest its 1 million ... 

This analysis is the final judgment as to whether the project should be further financed. In its simplest form it examines net earnings in relation to capital investment. Several methods of analysis will be discussed. 

The term non-profit elementary or secondary school means any elementary or secondary school (as defined in section 7801 of title 20) owned and operated by one or more nonprofit corporations or associations no part of the net earnings of which inures, or may lawfiiUy inure, to the benefit of any private shcffeholder or individual. 

Pub. L. 93-360, 1(a), July 26,1974,88 Stat. 395, deleted the phrase or any corporation or association operating a hospital, if no part of the net earnings inures to the benefit of any private shareholder or individual from the definition of employer. ]... 

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