Does operating profit include gains or losses on disposal of assets?

Contain. Operating profit = operating income Operating costs Taxes and surcharges.

Selling expenses Administrative expenses Financial expenses Asset impairment loss + fair value change gain (fair value change loss) + investment income (investment loss) + asset disposal gain (asset disposal loss) + other income.

In 2006, the Ministry of Finance promulgated the new Accounting Standard for Business Enterprises - No. 30 in the presentation of financial statements, which adjusted the operating profit, transferred the investment income to the operating profit, and at the same time abolished the reference to the main business profit and other business profits, and the subsidy income was merged into the non-operating income.

The total profit is obtained by subtracting the adjustment of non-operating income and expenditure.

Extended Information: Accounting Recognition of Gains on Disposal of Assets and Non-Operating Expenses:

If the asset has a use value after disposal, it is included in the "Profit or loss on disposal of assets."

Accounts, otherwise, they are included in the "Non-Operating Expenses" account.

For example, fixed assets.

After the damage is scrapped, there is no longer a use value, then the "non-operating expenses" account. If fixed assets are used to offset debts, investments, donations, etc., these business activities are in exchange for consideration and have a certain commercial value, they should be included in the "asset disposal profit and loss" account. The asset disposal gain item excludes the disposal of the following assets:

1) Disposal of liquid assets such as inventory, consumable biological assets, and accounts receivable.

2) Financial instruments, long-term equity investment.

Disposal. 3) Investment real estate.

Operating profit refers to the profit generated by an enterprise in its daily activities such as selling goods and providing services. It is the balance of the profit from the main business and the profit from other business after deducting the expenses of the period. Among them, the profit of the main business is equal to the income of the main business minus the cost of the main business and the tax and surcharge of the main business, which is also commonly referred to as gross profit.

Other business profit is the difference between other business income and other business expenses.

Extended Materials. Calculation formula.

Operating profit = operating income Operating costs Taxes and surcharges Selling expenses Administrative expenses Financial expenses Asset impairment loss + fair value change gain (fair value change loss) + investment income (investment loss) + asset disposal gain (asset disposal loss) + other income.

Operating profit margin = (operating profit operating income) 100%, operating profit margin indicates the ability of the enterprise to obtain profits through production and operation, the higher the ratio, the stronger the profitability of the enterprise.

Among them: operating income = main business income + other business income.

Operating cost = main business cost + other business cost.

Operating profit includes gains and losses on disposal of assets.

Gains and losses on the disposal of assets affect operating profit.

1. When intangible assets are included in the "asset disposal profit and loss" account after disposal, it will affect the operating profit.

The profit or loss on the disposal of assets affects the operating profit and is directly included in the profit or loss of the current profit or loss. Gains and losses on disposal of assets are newly added accounting accounts, which are mainly used to account for the gains or losses on disposal of fixed assets, intangible assets, construction in progress, etc., due to transfers, etc.

2. When intangible assets are included in the "non-operating income" account after disposal, the operating profit will not be affected.

Non-operating income does not affect operating profit. Because operating profit refers to the profit obtained by the enterprise engaged in production and business activities, while non-operating income refers to various incomes that the enterprise recognizes as not directly related to the production and business activities of the enterprise.

3. The net loss of disposal of fixed assets will lead to a decrease in the amount of profit in the current period, according to the item of "owner's equity" in the balance sheet, one of which is an item of "undistributed profit", which is obtained by accumulating the profit of the previous year through the current profit, and when the net loss occurs in the disposal of fixed assets, the amount of undistributed profit in the current period is reduced, and the natural owner's equity is reduced.

Gains and losses on disposal of assets:

The profit and loss of the asset disposal family is a newly added accounting account, which is mainly used to account for the disposal gains or losses arising from fixed assets, intangible assets, construction in progress, etc., due to **, transfer and other reasons. Gains and losses on asset disposal affect total profit. Gains or losses on disposal of assets are directly included in gains or losses for the current period.

If the asset has a use value after disposal, it is included in the "Profit and loss on asset disposal" account, and vice versa, it is included in the "Non-operating expenses" account.

If it is a net profit or loss for scrapping such as natural disasters, the asset has no use value (non-artificial) and is included in "non-operating expenses" and "non-operating income".

The profit or loss on the disposal of fixed assets or intangible assets arising from the active disposal (artificial) includes **, non-monetary asset exchange, debt restructuring, foreign investment and donation, etc., and also has use value and is included in the "profit or loss on asset disposal".

The difference between profit or loss on asset disposal and non-operating income: Non-operating income and expenditure refer to income and expenditure that are not directly related to the business operation of the enterprise.

Non-operating income and expenditure refer to income and expenditure that are not directly related to the business operation of an enterprise. Gains and losses on disposal of assets are newly added accounting items, which are mainly used to account for enterprises** or disposals: 1. Disposal gains recognized when classified as non-current assets held for sale (except for Jinqin financing instruments, long-term equity investments and investment real estate) or disposal groups (except subsidiaries and businesses).

2. Gains or losses on disposal of fixed assets, projects under construction, productive biological assets and intangible assets that are not classified as held for sale.

3. Gains or losses arising from the disposal of non-current assets in debt restructuring. For example, the gains or losses arising from the exchange of non-current assets in the exchange of non-monetary assets, such as the disposal of fixed assets that are normal and can still be used, are accounted for as gains or losses on asset disposal. If it is unusable and the disposal is a scrapped fixed asset, it will be accounted for as non-operating receipts and expenses.

4. The profit and loss item of asset disposal reflects the gain or damage determined when the company sells non-current assets (except for financial instruments, long-term share investment and investment in real estate) or disposal group, for example, if the disposal of fixed assets is normal and can still be used, it will be accounted for as asset disposal profit or loss. If it is not available, the disposal of scrapped fixed assets is accounted for as non-operating income and expenditure.

Impact on operating profit.

The profit and loss on asset disposal is mainly used to account for the disposal gains or losses arising from fixed assets, intangible assets, etc., such as transfers, etc., which affect operating profits. Gains and losses on disposal of assets are profit and loss accounts.

Increase credits and decrease debits. In the event of a net loss on disposal, the "Gain or Loss on Disposal of Assets" is debited, or if it is a net gain, the "Gain or Loss on Disposal of Assets" is credited.

Gains on disposal of assets do not include inventory, consumable biological assets, and accounts receivable.

disposal of assets such as buckets or hosiery movements; Financial instruments, long-term equity investments.

Disposal. Investment real estate.

Disposal. gains or losses on debt restructuring and gains or losses on the exchange of non-monetary assets; Gains and losses on disposal of subsidiaries and other disposals.

However, when the normal accounting treatment of enterprise assets such as the retirement of fixed assets, the cancellation of intangible assets, and unexpected disasters no longer has use value, the net profit or loss arising from the cancellation of non-current air-generated assets such as fixed assets and intangible assets will be included in the account of "non-operating income" or "non-operating expenses of Tuansui".

Contain. Operating profit = operating income Operating costs Taxes and surcharges Selling expenses Administrative expenses Financial expenses Asset impairment loss + fair value change gain (fair value change loss) + investment income (investment loss) + asset disposal gain (asset disposal loss) + other income.

In 2006, the Ministry of Finance promulgated the new Accounting Standards for Business Enterprises - No. 30 in the presentation of financial statements, the profit of operating or partnering business has been adjusted, the investment income has been transferred to the operating profit, and the reference to the profit of the main business and other business has been cancelled, and the subsidy income has been merged into the non-operating income, and the total profit is obtained by subtracting the adjustment of operating profit from non-operating income and expenditure.

Gains and losses on disposal of assets fall under the category of operating profit

Gains and losses on disposal of assets are the profits or losses incurred by a business when it disposes of assets. These assets can be fixed assets, intangible assets, long-term investments, etc. The profit or loss on disposal of assets is a very important indicator in the financial statements of a business, as it directly affects the profit level and profitability of the enterprise.

When an enterprise disposes of an asset, if the transaction price is higher than the original cost or book value, then the enterprise will receive an asset disposal gain, on the contrary, if the transaction price is lower than the original cost or book value, then the enterprise will incur an asset disposal loss. The cost of an asset includes the cost of acquisition and related expenses in the later stage, such as depreciation, maintenance, etc.

Gains and losses on the disposal of assets are included in the company's income statement. Since these gains and losses are non-recurring, they are included in the non-recurring profit or loss in the income statement. This means that they are different from the gains and losses of regular business activities, such as profits from the sale of products or the provision of services.

The profit and loss from asset disposal has a great impact on the financial condition and operating performance of the enterprise. On the one hand, it directly affects the profits and performance of enterprises, so enterprises need to dispose of assets according to market demand and development strategies to strive for as much income as possible.

On the other hand, the profit or loss on asset disposal can also reflect the operation and management ability of the enterprise. If the profit or loss on the disposal of assets of the enterprise has been negative, it means that the enterprise is not well managed or the market environment is relatively poor, and active measures need to be taken to improve.

The manner in which the asset is disposed of

1. Assets: It is the most common way to dispose of assets. Enterprises can give their assets to other enterprises or individuals through public bidding, bidding, direct negotiation, etc.

2. Asset replacement: It is the behavior of an enterprise exchanging one asset under its name for another asset. Common asset swap methods include asset swaps, asset swaps, and equity transfers.

3. Leasing: Enterprises can obtain economic benefits by leasing their own assets. Leases can take the form of long-term leases, short-term leases, and operating leases, among others.

4. Mortgage: Enterprises can mortgage their assets to obtain economic benefits, which is more common in the financing of enterprises.

In accounting practice, if the net profit or loss after the liquidation of fixed assets is transferred to the asset disposal profit and loss account, will the profit or loss on asset disposal affect the operating profit?

Gains and losses on the disposal of assets affect operating profit.

"Profit and loss on disposal of assets" is a profit and loss account, which belongs to the gains and losses directly included in the profit or loss of the current period, which is used to account for the disposal gains or losses arising from fixed assets, intangible assets, etc., due to **, transfer and other reasons. As a result, there will be an impact on operating profit.

Gains and losses on disposal of assets are credited more and debited less. In the event of a net loss on disposal, the "gain or loss on disposal of assets" shall be debited, and if the sales are net gains, the "gains or losses on disposal of assets" shall be credited.

What is the difference between gains and losses on disposal of assets and non-operating expenses?

If the asset has a use value after disposal, it will be included in the "asset disposal profit and loss" account, otherwise, it will be included in the "non-operating expenses" account.

For example, if a fixed asset is scrapped due to damage and no longer has a use value, it is accounted for through the "non-operating expenses" account. If fixed assets are used to offset debts, investments and donations, because the purpose of these business activities is to exchange for consideration and has a certain commercial value, it will be included in the account of "profit and loss on asset disposal".

Accounting entries for gains and losses on disposal of assets.

1. Transfer the fixed assets to the fixed assets for disposal.

Borrow: Disposal of fixed assets.

Accumulated depreciation. Provision for impairment of fixed assets.

Credit: Fixed Assets.

2. When cleaning costs are incurred.

Borrow: Disposal of fixed assets.

Credit: Bank deposits.

3. External sales or compensation, etc.

Debit: Accounts receivable or bank deposits.

Credit: Disposal of fixed assets.

4. Pay VAT.

Borrow: Disposal of fixed assets.

Credit: Tax payable - VAT payable (positive output tax loss) (general tax calculation of general taxpayers).

Tax payable - simple tax calculation (simple collection of general taxpayers).

Tax payable – VAT payable (small-scale taxpayers).

5. Carry-forward net profit or loss.

Net Loss: Debit: Gain or Loss on Disposal of Assets.

Credit: Disposal of fixed assets.

Net Income: Borrow: Fixed Asset Disposal.

Credit: Gains and losses on disposal of assets.

Fair value change gains and losses affect operating profit. Sun Sensui

Because operating profit includes gains and losses on fair value changes. The formula for calculating operating profit is as follows: operating profit = operating income - operating costs - business taxes and surcharges - selling expenses - administrative expenses - financial expenses - asset impairment loss + fair value change income (- fair value change loss) + investment income (- investment loss).

Fair value is also known as fair market value. A transaction that is determined by a buyer and seller who are familiar with the market situation on an arm's length basis and voluntarily, or by an unrelated party that can be bought or sold or a liability that can be discharged under arm's length conditions.