Net Sales

Net Sales
The amount of sales generated by a company after the deduction of returns, allowances for damaged or missing goods and any discounts allowed. The sales number reported on a company's financial statements is a net sales number, reflecting these deductions.

Deductions from the gross sales are represented in the net sales figure. Therefore, net sales gives a more accurate picture of the actual sales generated by the company, or the money that it expects to receive. A company will book its revenue once the good or service is delivered or performed for the customer. However, in the case of returns, even after a good has been sold it can often be returned under a company's return policy. If the good is returned by the customer, it is not considered a sale, as the customer will receive a credit or money back, so it needs to be deducted from the gross sales. The allowances for damaged or missing goods reflect the situations in which the goods are damaged in transit or are not what the customer expected.

Many companies also offer discounts, especially on credit sales where the customer pays off the amount early. This discount is deducted from gross sales, reducing overall revenue.

Investment dictionary. . 2012.

Игры ⚽ Нужно сделать НИР?

Look at other dictionaries:

  • net sales — Term used to describe a firm s revenue after the amount of returns, allowances, and discounts is deducted from gross revenue from the firm s principal operations. American Banker Glossary Gross sales less returns and allowances, freight out, and… …   Financial and business terms

  • net sales — /net seɪlz/ plural noun sales less damaged or returned items, discounts to retailers, etc …   Marketing dictionary in english

  • net sales — /net seɪlz/ plural noun the total amount of sales less damaged or returned items and discounts to retailers …   Dictionary of banking and finance

  • net sales — Sales after the deduction of *discounts, *rebates, *allowances for bad debts, and *customer returns …   Auditor's dictionary

  • net sales value — grynoji realizavimo vertė statusas Aprobuotas sritis buhalterinė apskaita ir finansinė atskaitomybė apibrėžtis Įprastinės veiklos metu įvertinta turto pardavimo kaina, atėmus įvertintas turto vieneto gamybos baigimo ir įvertintas turto pardavimo …   Lithuanian dictionary (lietuvių žodynas)

  • net sales — noun gross sales reduced by customer discounts, returns, freight out, and allowances • Hypernyms: ↑income * * * noun plural : the balance of gross sales remaining after deducting trade discounts, returned sales, and sales allowances …   Useful english dictionary

  • net sales — noun The value of sales generated by a company after deduction of returns, discounts and the value of damaged or lost goods …   Wiktionary

  • net sales — Gross sales minus returns, allowances, rebates, and discounts …   Black's law dictionary

  • net sales — Gross sales minus returns, allowances, rebates, and discounts …   Black's law dictionary

  • net sales transaction — Refers to over the counter trading. securities deal in which the quoted prices include commissions ( i.e., OTC); looked at another way, the buyer and seller do not pay fees or commissions in addition to the print or quotation prices. Bloomberg… …   Financial and business terms

Share the article and excerpts

Direct link
Do a right-click on the link above
and select “Copy Link”