What is Profitability: Operating Profit Earned in SAP SRD-FIN-ACC - FIN-Financial Accounting?

SAP Term: Profitability: Operating Profit Earned

• Component: SRD-FIN-ACC

• Component Name: FIN-Financial Accounting

• Description: A key performance indicator KPI that shows a company's total Operating Profit – Earned for the current fiscal year to date. Operating profit represents the profit of a company and equals the total operating result by subtracting operating expenses from Gross Profit - Earned. This KPI shows how much profit a company generates before interest, expenses and income taxes.

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• Key Concepts: 
  Profitability is a measure of the operating profit earned by a company. It is calculated by subtracting total expenses from total revenue. Operating profit is the amount of money a company earns after all costs associated with running the business have been deducted. It is an important metric for assessing the financial health of a company. 
  
  How to use it: 
  In SAP Financial Accounting (SRD-FIN-ACC FIN-Financial Accounting), profitability can be measured using the Profit and Loss Statement (P&L). This statement shows the total revenue, total expenses, and operating profit for a given period of time. It can be used to compare profitability between different periods or to compare profitability between different companies. 
  
  Tips & Tricks: 
  When analyzing profitability, it is important to consider both the absolute value of operating profit and the rate of change in operating profit over time. This will give you a better understanding of how well the company is performing and whether or not it is on track to meet its financial goals. 
  
  Related Information: 
  For more information on profitability, please refer to SAP’s Financial Accounting documentation. Additionally, there are many online resources available that provide detailed explanations of profitability and how to use it in SAP Financial Accounting.