Income Statement Flashcards
understand all the KPI of the Income Statement
Orders
Number of offers accepted by the client
Sales (606)
costs incurred + margin related to the project
Sales (605)
Sales related to a payment milestone
Income Statement Definition
Presents the results of the operating activities of a business (net income or loss) over a period of time
Contribution Margin
Sales - Variable Cost
Operating Margin
Contribution Margin - Base Cost
Income Before Income Taxes
Operating Margin + Other Income (Loss) - Interest Expense (Income)
Net Income
Income Before Income Taxes - Provision for Income Taxes - Non-Controlling Interests
Operating Profit
Operating Margin + Other Income (Loss) - Interest Expense (Income)
CoQ (Cost of Quality)
Total expenses incurred to maintain and ensure product/service quality, encompassing prevention costs, appraisal costs, costs associated with addressing failures
Cost of Warranty (CoW)
Expenses related to fulfilling the company’s warranty obligations, including repair, replacement and associated service costs
PMR (Project Margin Review)
Criteria Evaluation that occur quarterly for Major Attention Project (MAP) and annually for other projects. These reviews focus on validating project margin and involve a comprehensive assessment of project portfolios, including risk exposure, margin erosion and sales forecasts
CCM
Trading margin, margin associated with the rev rec (cost incurred)
CM (IS equation)
CM = CCM + PMR + OVC
OVC (Other Variable costs) IS equation
OVC = CoQ + CoW + Others
