Proceeds from Sales

Proceeds from Sales 

money income received by an enterprise from customers or clients for products sold and for jobs and services performed. In the USSR, proceeds from sales, as the enterprise’s primary income and main source of monetary receipts, reflect the results of the enterprise’s production-economic performance for a certain time period (year, quarter, month).

Proceeds from sales comprise monetary proceeds from the sale of finished or semifinished articles produced by the enterprise itself and for the performance of jobs and services of an industrial nature, which includes capital repair to the enterprise’s own equipment, as well as sale of products to the enterprise’s own capital construction and to nonindustrial units carried on the enterprise’s balance.

The size of proceeds from sales depends on the quantity, assortment, and quality of products sold and on the level of wholesale prices. The size of proceeds is also influenced by timely shipment of products to customers and the speeding up of monetary accounts between the purchaser and the supplier.

Proceeds from sales are planned in the currently operating enterprise wholesale prices laid down in the plan, taking into account supplements and discounts if these are provided for in retail prices, less turnover tax and trade margins. In the accounts, proceeds of sales are given in two ways: planned wholesale prices of the enterprise are used to evaluate plan fulfillment and the rate of increase of sales in comparable prices, and also to compute the magnitude of incentive funds and the fund for development of production; on the other hand, the proceeds are also given in the prices actually operative in the accounting period (for computing actual profits from sales).

As a basic index, proceeds from sales intensify the interaction between the spheres of production and circulation and make product output more closely dependent on the requirements of the national economy for actual types of output.

Accounts between enterprises and economic organizations are ordinarily conducted on a noncash basis; in accordance with this, proceeds from sales go not to the enterprise’s cash desk but rather to its current account in the bank.

Proceeds from sales are a primary source of compensation for expenditures on the production and marketing of products. The enterprise uses the proceeds for such purposes as paying suppliers of material inputs, paying wages of production and office workers, and allotting sums to the depreciation fund and the incentive funds, as well as for paying sums to the budget for the turnover tax, payments for the use of productive, fixed, and working capital, other fixed payments; the residual profits, interest on bank credits, and so on.

REFERENCES

Finansy promyshlennosti. By an author’s collective under the direction of M. A. Pessel’. Moscow, 1958. Chapter 4.
Finansy predpriiatii i otraslei narodnogo khoziaistva. By an author’s collective under the direction of N. G. Sychev. Moscow, 1967. Chapter 4.
Spravochnik po finansovo-ekonomicheskim raschetam. Compiled by M. A. Barun. Moscow, 1966. Chapter 1.

IU. A. GAIDUKOV