About summary reports

There are four groups of summary reports in Sales Analysis:

  • gross profit

  • profit margin versus profit markup

  • booked sales versus actual sales

  • budgeted sales versus actual sales

Different summary reports list the gross profit and profit margin versus the profit markup. They also compare the period-to-date and year-to-date:

  • booked sales to actual sales; and

  • budgeted sales to actual sales

for each fiscal period and year you select.

Summary reports contain summarized data; therefore, you must have chosen to summarize sales data when you set up your Sales Analysis company if you want to perform inquiries and print summary reports. You can change the decision you made during company setup at any time. See Changing your summarization setup decision.

Profit margin

The profit margin is a percentage that represents the amount of sales that is profit. This calculation is used to arrive at the profit margin:

(Sales - Cost) / Sales = Profit Margin

Companies that use a list price pricing strategy usually analyze sales by profit margin. With list price pricing, the price of an item changes based on its market value. The price charged to the customer is calculated by discounting from list.

Profit markup

With profit markup, the focus is more with return on investment, or the amount of profit made compared to what is spent. This calculation is used to arrive at the profit markup:

(Sales - Cost) / Cost = Profit markup

Companies using a cost plus strategy usually examine sales by looking at the profit markup. With cost plus pricing, the cost of an item remains constant and has no relation to where it is sold. These companies price an item by starting with the item cost and modifying that by a markup.

Each company analyzes profit performance to suit its own needs, whether that involves profit margin or profit markup.

Booked sales

Booked sales, called Bookings, represent demand. Booked sales occur when you release an order in the Order Entry application. Because an invoice does not exist for the order, the sale is considered only booked. You can select whether or not to subtract order amounts from booked sales when you delete orders.

Note: Order changes involving, for example, quantities or items are reflected in Sales Analysis automatically when you run the batch program to summarize the data.

When you delete an order or order line, the application uses the cancellation reason code you set up in the Billing application. The reason code reduces booked sales if you select the Remove Booking option when you define the reason code. See Reason code.

Actual sales

Unlike booked sales, actual sales have invoices associated with them. They occur when you run a batch program to update invoices to an interface in the Accounts Receivable and General Ledger applications.

Actual sales are available to Sales Analysis after invoices are processed through the subsystem update. See Updating invoices and credit memos.

Budgeted sales

Budgeted sales are forecasted sales, or costs, or quantities by period and year. By forecasting how much you expect to sell, you can anticipate what to buy for the upcoming year.