For any business owner and company manager in Dubai, Jebel Ali, Abu Dhabi, RAK or Sharjah in United Arab Emirates, it is very important to have exact report of profit and loss statement because VAT report should be correct or a big fines will be issue from UAE Government. but calculating profit statement is not easy process. actually profit and loss statement is a sub statement of income statement in every company in UAE.
Methods of Profit Statement in UAE
There many methods to get profit statement report but commonly we can list them as below:
- It means price of first item has been purchased and and price of the first sales item
- It mean price of the latest item for purchase price and price of the first sales item
- Average of prices
- It means average price of all purchases and Average price of all sales
- Unique Price code
- In this method, each item will get a unique serial number label with a its price of purchase and sales
FIFO will be used for food industrial and business with expiring date of products, LIFO will be used for update to date businesses like CAR companies, Average method is common method for shops and retail stores.
Unique price code is the best method, each item in purchase time will get a unique barcode label with a unique serial number and at sales time, this barcode will be scanned and entered in invoice. so that, each item one by one, has its purchase price and sales price exactly.
iGreen software with a new accounting application supports methods of average price and unique price code. for price code method , iGreen accounting will give you printed labels to stick it on items as same time of purchase.