Learn how SuperOps calculates Revenue, Cost, and Profit, and see how these calculations power our Financial Reports for accurate business insights.
Revenue Calculation
Revenue is the total amount earned from contracts, tickets, or projects.
Revenue = Quantity × Selling Price.
Cost Calculation
Cost represents the expense incurred to deliver the service or product. The calculation varies based on contract type and technician involvement.
Contracts
Included Items: Cost is the sum of (Quantity × Cost Price) for all included items.
Hourly Items: Cost is calculated as Technician Burden Rate × Hours Invested.
Tickets and Projects
Hourly Offerings: Cost is Technician Burden Rate × Hours (Quantity).
Product-Based Offerings: Cost is Cost Price × Quantity.
📝Note: If an item does not have a "cost price," it defaults to $0. If the Technician Burden Rate is not entered, it is also considered $0, which affects profit calculations.
Profit Calculation
Profit is derived by subtracting the cost from revenue.
Profit = Revenue - Cost
Profit calculations apply at different levels, including technicians, contracts, and overall client profitability.
Example Scenario
Imagine a ticket is associated with a Gold Plan contract. This contract includes Managed Hour an included item, with a unit price of $1000. A technician, John Doe, works on the ticket for 7 hours, and his Technician Burden Rate is $200 per hour.
Contract Details:
Managed Hours is a block-hour service with 5 hours included in the contract, under which Labour is an hourly- service.
Unit Price of Labour Service: $300 per hour.
Any extra hours beyond the included 5 hours are billed separately based on the unit price.
Labour Revenue Calculation
Revenue for John’s work is: Unit Price of Labour × Total Hours Worked = $300 × 7 = $2100
Technician Cost Calculation
Cost of John’s work is: Technician Burden Rate × Total Hours Worked = $200 × 7 = $1400
Technician Profit Calculation
Profit = Revenue - Cost = $2100 - $1400 = $700
Contract Revenue Calculation
Contract Revenue = $1000 (Fixed contract price)
Contract Cost = $200 × 5 = $1000, since only 5 hours are included in the contract.
Contract Profit = Revenue - Cost = $1000 - $1000 = $0
Client Profitability Calculation
Client profitability is determined by adding all contract revenues and subtracting the sum of all technician costs for that client.
Formula:
Client Profitability = Total Revenue for the Client - Total Cost of the Client
