Definition

How it’s Calculated Total Net Profit (before owners’ salaries & remuneration) = _____________________________________                      Total Interest expense   How it’s Used Higher results show that the business is highly capable of servicing its interest expenses. Interest cost is often not reported on its own –...

  How it’s Calculated   Growth Capacity calculation:   $ of Net Profit – ($ of Current assets - $ of Current liabilities) = ______________________________________  x 100                                      ...

How it’s calculated ((Net Profit (bos) – Current assets – Current liabilities) / Total Income) * 100 See our for explanation of Net Profit (bos) (link to https://www.benchmarking.com.au/net-profit-benchmark-calculation/) How it’s used Growth Capacity is a benchmark which shows whether the business can afford...

How it’s calculated Net Profit can be calculated before owner’s salary (bos) is removed or after owner’s salary (aos) is removed. Net Profit (bos) calculated as: Total Income – Expenses (excluding Owner’s Wages and Superannuation)   Net Profit (aos) is calculated as: Total Income –...

How it’s calculated Net Profit per Owner can be calculated before owner’s salary (bos) is removed or after owner’s salary (aos) is removed.   Net Profit (bos) per Owner is calculated as: Net Profit (bos)  / Full Time Equivalent (FTE) Owners   Net Profit (aos)...

How it’s calculated   Employee Wages as a percentage of Total Income is calculated as:   (Employee Wages & Salaries / Total Income) * 100   Note: Employee wages does not include superannuation, owner’s wages or owner’s superannuation.   How It’s Used When benchmarking expense items, such as...

How it’s calculated   Revenue Per Employee is calculated as:   Revenue Per Employee = Total Revenue / Total Full Time Equivalent Employee   See here for explanation of Full Time Equivalent Benchmark Calculation   How it’s used Revenue per employee is an important financial benchmark because it...

What it is Full Time Equivalent (FTE) is NOT headcount. Some people in your business may have only worked for part of the year or are part time. In these cases, the full time equivalent is less than 1. Also see...