In this tutorial, you will learn how to calculate net revenue in Google Sheets.
How To Calculate Net Revenue in Google Sheets
Net revenue is a key financial metric that businesses use to measure their performance. It is the total amount of money made from sales after all other costs and expenses have been deducted. It is an important indicator of a company’s financial health and helps to compare the profitability of a business over different periods of time.
We can calculate the net revenue by subtracting certain expenditures such as refunds and discounts from the total gross revenue. For example, if our company has a total gross revenue of $2500 and has to account for $200 in refunds and discounts, then the net revenue is $2500 – $200 = $2300. Other costs that can be deducted from gross revenue include employee commissions and other price-deducting promotions.
Because the net revenue value considers these additional expenses, the net revenue provides more insight into the actual profitability of your business (compared to the gross revenue).
In this guide, we will show you how to calculate net revenue in a Google Sheets spreadsheet.
How To Find the Net Revenue in Google Sheets
Here’s how to find the net revenue of your business in Google Sheets.
First, determine the gross revenue of your business during a specific time frame.
In our example, we’ve computed the gross revenue of a company that sells a single product. In a single year, they’ve generated $1800 in sales after selling 1200 units of the product.
Next, we must indicate the total amount spent on product discounts.
We must also indicate the amount lost to refunds and returns.
For example, if our item is sold for $1.50 and 25 customers ask for a refund, we must account for about $38 in refunds.
We can calculate the net revenue by subtracting the refunds, returns, and discounts from the company’s total gross revenue.
This guide should be everything you need to calculate net revenue in Google Sheets.
You may make a copy of this example spreadsheet to test it out on your own.