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Income Statement Analysis for Accessories

The document compares the typical income statement of an HVAC dealer that does not sell accessories to one that does. It shows that selling accessories at equipment margins generates additional gross margin and net profit per job. It also calculates that including accessories on a portion of replacement jobs could significantly increase a dealer's total annual profit and have positive effects on other aspects of the business like employee morale and marketing.

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selvamejia
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13 views2 pages

Income Statement Analysis for Accessories

The document compares the typical income statement of an HVAC dealer that does not sell accessories to one that does. It shows that selling accessories at equipment margins generates additional gross margin and net profit per job. It also calculates that including accessories on a portion of replacement jobs could significantly increase a dealer's total annual profit and have positive effects on other aspects of the business like employee morale and marketing.

Uploaded by

selvamejia
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as XLS, PDF, TXT or read online on Scribd

Example Income Statements

(Showing the Value of Selling Accessories)

Typical Replacement

With Accessory

(Without Accessory)

(Priced at Equipt. Margin)

Sales
Direct Costs
Labor
Material
Equipment
Total Direct Costs

$0 100%

$0 100%

$0

60%

$0

60%

Gross Margin (GM)

$0

40%

$0

40%

Overhead (OH)

$0

35%

#DIV/0!

Net Profit Before Taxes

$0

5%

#DIV/0!

Add Commissions to Equipt. Cost.

Typical HVAC
Dealer

Informed Dealer
After Learning To Sell Accessories
With:
#DIV/0! Of Replacement Jobs

Accessories Included -

No

Yes

Number of Jobs Per Year :


Net Profit Per Job:

*
$0

#DIV/0!

Total Annual Profit:

$0

#DIV/0!

No

Total Jobs

0
$0

$0

Accessory Commissions:
Effects on:

* Dealer Inputs

Employee Morale? Marketing? Referrals? Warranty Work? Employee Turnover?


Ability to Hire the Best People? Owner's Motivation? Company Culture?

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