Profit total

The point at which the cumulative cash flow turns positive indicates the payout time (or payback time). This is the length of time required to receive accumulated net revenues equal to the investment. This indicator says nothing about the cash flow after the payback time and does not consider the total profitability of the investment opportunity. 

A related problem is the allocation of costs when a raw material for one process operation is produced internally by another process operation of the same organization (17). The transfer or captive price assigned to the raw material can range from the production cost to a market price that reflects a total profit margin for the material producer, depending on the accounting procedures adopted. 

The total profits (before tax) over the life of a project are independent of the method used to value inventoiy. Over a project life of n years, Eq. (9-148) can be written as... 

Since there will be no material in inventoiy in the year before the projec t starts or in the year after it terminates, 1q = l + i =0. Hence, total profits do not depend on individual values for 7. 

The importance of time to market has recently been shown to be responsible for over 30% of the total profit to be made from a product during its life-cycle. However, it has been found that nearly 30% of product development programmes overran their planned times (Maylor, 1996 Nichols et al., 1993). The reduction in profit due to late delivery of the product to market is shown in Figure 5.1 for a sample of businesses surveyed. 

Production planning includes considerations on production objectives over a certain time horizon given marketing forecasts for prices and product demands, equipment availability, and inventories. This is a macrolevel problem of the allocation of production capacity, time, product inventories, and labour and energy resources, so as to determine the production goals that maximize the total profit over an extended period of time into the future (e.g. a few months to a few years). 

The two indicators used in Example 10-5 give different answers. The Proceeds per Dollar of Outlay procedure is obviously wrong. It would take 12.5 years to pay off the investment for plant 1. If the 15,000,000 pretax profit available at the end of year 4 were invested at 7% interest, the accumulated interest would have exceeded 10,800,000 before plant 1 was paid for. In other words, the total profit for plant 1 would exceed 25,800,000 before plant 2 showed a profit. This is more than the total profit made by plant 2 during its whole life. If the 15,000,000 profit of plant 1 were invested for 21 years at 7% compounded annually, the total interest would amount to 47,100,000 or the total earnings would be 62,100,000. If after plant 2 were paid off die profits were invested at 7% per year, the interest would amount to 8,900,000 or a total pretax profit of 33900,000 25 years after the plant startup. This is 28,200,000 less than that earned in the same amount of time by plant 1. This shows that for this example the Annual Proceeds per Dollar of Outlay is a better economic indicator. 

Solution. For one complete cycle of operation and regeneration, the objective function for the total profit per day comprises... 

The objective function was defined in terms of alkylate product, or output value minus feed and recycle costs operating costs were not reflected in the function. The total profit per day, to be maximized, is... 

ROA Net nrofit Total assets Indicator to compare total profit return on assets specifically in asset-intensive industries... 

Focus on total profits with given demand and siupply ... 

Value management concepts focus on total profit analysis with given demand and supply... 

Solution times are sufficiently fast to be applied in tactical planning where no real time response times are required. Secondly, value results are presented. All value results are indexed focusing on comparing results and to ensure confidentiality of industry data. Initially, the value plan with total profits and single values in sales, distribution, production and procurement is analyzed. 

Fig. 76 shows the total profit index as bar column related to the left vertical axis. The profit index indicates the planned profit per period over the... 

Fig. 85 shows the different exchange rate index experiments on the horizontal axis with the basis experiment indexed with 100. The total profit index is represented by the column bar related to the left vertical axis. The volume indices for sales, inventory, production and procurement as well as the value-added index are represented by the lines with markers related to the right vertical axis. This figure structure and the sequence of indices oriented at the value chain structure will be used also in the following experiments. 

The model has been evaluated by means of a global commodity industry case. The evaluation proved the importance of value chain planning to integrate volume and value decisions from sales to procurement exchange rate, sales and raw material price and elasticity scenarios have key influences on total profit and volume planning decisions within the global value chain network. 

This is an ex post identity between total profits (P ) and the economy s output of capital goods (W ) and capitalists consumption goods (W2). Kalecki poses the key question as to how we should interpret this identity. Are expenditures upon capital goods and capitalists consumption goods determined by profits, or are profits determined by these expenditures He argues that capitalists can decide how much they will invest and consume next year, but they cannot decide how much they shall sell and profit (ibid. 461). It is the money expenditures by capitalists upon consumption and investment that generate the resultant volume of profits. 

This final equation represents a multiplier relationship between total profits and the total exogenous expenditure by capitalists (B0 + I), the multiplier being defined as 1/1-A. With this Kalecki multiplier relationship, profits are determined using exogenous investment and capitalist consumption. 

To explore how the Kalecki principle can be applied to Grossmann s numerical simulation, we can first show how equation (7.1) relates to Table 7.1. In year 1, total profits of 100,000 consist of 75,000 units of capitalist consumption together with 20,000 constant capital and 5,000 variable capital 25,000 units of investment in total. Hence the identity... 

Constant capital (Q) Variable capital (VO Cost price (C, + VO Average rate of profit (Zs/ct + VO Total profits Price of production Price minus value... 

The latter response has been adopted in the Sraffian critique of Marx. This approach has its roots in the pioneering contribution, in 1907, of von Bortkiewicz, who set up a procedure for transforming both inputs and outputs into prices (Bortkiewicz 1951-2). The result, later generalized by Wintemitz (1948) and Seton (1975), is a weakening of the relationship between values and prices. Marx s invariance postulates, that total profits should equal total surplus value and total prices should equal total value, cannot both be maintained once inputs and outputs are transformed into prices. 

Under (8.5), Marx s invariance postulate between total profits and surplus value is therefore established, with the value of money as the mediating coefficient. And in place of the equality between total value and price, a new invariance postulate is suggested in (8.3) between total labour-time and money value added. A coherent defence of Marx s labour theory of value is developed by abandoning the second invariance postulate and the labour embodied definition of the value of labour power (see Foley 1982 43). 

In conclusion it may be summarised that the Chemical Leasing business model represents an interesting additional offer, which results in a distinct decrease of chemicals usage and wastes (above all dangerous wastes). Furthermore, total costs of the user are decreasing on the one hand and on the other hand total profits of the supplier are rising. 

The objective function represent the total profit and takes the form ... 

In a deterministic planning environment the most likely scenario, here scenario 2, would be considered the base case and the optimization model would be solved based on this scenario. The optimal decision would be to open facility 1 in period 1 and facility 3 in period 2 leading to a total profit of 2,590. To assess the robustness of this network to alternative demand scenarios the profit achievable with this configuration in case of the alternative demand scenarios can be assessed. In the example, for scenario 1 the overall profit would be 1,640 and for scenario 3, 2,765 respectively. Considered individually, the optimal decision for scenario 1 would be to open only facility 1 with a total profit of 1,880 and for scenario 3 to open both facilities 1 and 2 in period 1 with a total profit of 2,931. In order to explicitly incorporate the uncertainties caused by the different realization probabilities of the three demand scenarios, the optimization model can be extended into a two-stage decision with recourse ... 

Characteristics Up to hundreds of kilotons Continuous Total profits are 5-30% turnover Material and energy costs are 70-90%, labor costs 10-30% of total costs Up to hundreds of tons Mostly batch, some parts continuous Total profits are 20-40% turnover Material and energy costs are 70-90%, labor costs 10-30% of total costs Up to tens of tons Mostly batch, some parts continuous Total profits are 30-50% turnover Material and energy costs are 50-80%, labor costs 20-50% of total costs Up to tens of tons Mostly batch Total profits are 30-70% of turnover Material and energy costs are 10-30%,labor costs 70-90% of total costs... 

Perfect competition (PC) Total profits PCO PC20-ze Change in Price effects profits due to Free allocation Total change in profits... 

Scenario1 Price elasticity Total profits [M ] Change Price effects [M ] in profits due to Free allocation [M ] Total change in profits due to emissions trading [M ] [%] ... 

Selling price may change depending on the production level P due to market circumstances. Figure 3 shows a plot of the sales revenue, which, for illustration, is linear with P. It also shows the total product cost plotted at various production levels, which nearly depends on the 0.6 power of P. At high production levels, total production costs lay below the possible sales revenue the difference between the two costs indicates the total profit at that production level. At low production levels total production costs are larger than the possible sales revenue, and plant operation yields losses. The production level at which total costs equal the possible revenues is the break-even point. Plant production and sales must run at higher rates for the operation to be competitive. 

The terms gross income or gross revenue used by accountants refer to the total amount of capital received as a result of the sale of goods or service. Net income or net revenue is the total profit remaining after deducting all costs, including taxes. 

In small business establishments, it is usually quite easy to determine the exact source of all capital. Therefore, the interest costs can be obtained with little difficulty. For example, suppose that a young chemical engineer has 20,000 and decides to set up a small plant for producing antifreeze from available raw materials. For a working-capital plus fixed-capital investment of 20,000, the chemical engineer determines that the proposed plant can provide a total yearly profit of 8000 before income taxes. Since the investment was a personal one, interest obviously could not be included as a cost. If it has been necessary to borrow the 20,000 at an annual interest rate of 10 percent, interest would have been a cost, and the total profit would have been 8000 — (0.10) x ( 20,000) = 6000 per year. 

Interest is charged on the total capital investment at a set interest rate. Rates equivalent to those charged for bank loans or bonds are usually employed. Under these conditions, the total profit represents the increase over the return that would be obtained if the company could invest the same amount of money in an outside loan at the given interest rate. 

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