Stelarr
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Posted - 2008.03.13 22:36:00 -
[1]
Ok, the title is kind of stupid, but how exactly do you calculate manufacturing/selling profit? Here is my situation :) About a month ago I came back to eve after a long break, and decided to play my munufacturing char full time. I have making very nice profit last 3 weeks. However this week I'll be in the negative.
Not very surprising since I bought a 30day gtc, and my total capital was at about 1billion. However, it appears that I would have a lose in total value even if I didn't count isk spent on gtc.
So, I tried to figure out how that could happen, which led me to thinking about how I calculate profit/total value. I manufacture and sell items (t1  which are supposedly none profitable lol) So, at any time I will have a stock pile of minerals, items in production and items on market. Theoreticaly I cannot be in the negative. I buy minerals from market, make items and sell them at a profit (profit being sold price-(price of minerals+ cost to manufacture+ taxes/broker fee)= positive number. The only way I can be in the negative is if I sell items at a lose. So it must be an accounting "error" as such I am wondering if anyone has any suggestins on how I could improve the way I calculate the total value of my assets.
Minerals, I use a number that is generally 1-3% higher than the "sell" price in jita. While this does not necessarily represent the true value of minerals, I don't sell minerals, and since I sell produced items at a profit (using those numbers for calculating price of minerals for production) it doesn't really matter. Plus it asures that I can buy minerals from market if my buy orders aren't met and still manufacture items at a profit. However, because the true price of minerals is less than what I count it at, it means that if I dumo 10mil into minerals and then calculate total worth of assest, it would appear as 10.3mil (or so)
Items in production. I decided to calculate those as the total of the minerals needed to manufacture them, but without the manufacturing price. Manufacturing price, for now, is pretty low and is covered by the profit when items sell. However, this means if I use 1mil worth of minerals to make items and pay 50k for instalation fees, and then recalculate total worth it would show up as 1m (meaning the 50k I paid are not accounted for).
Items in sell orders. I actually calculate their worth as being equal to items in production. And much like with production, I don't calculate the taxes/broker fee So, this means if I put100mil worth of stuff on the market, and pay default 2% taxes, and then calculate total assets the 2millions paid in taxes wouldn't be accounted for.
When I started I figured those things don't matter, since I am not sellign minerals, and when manufactured items sell the sales price will cover all the expenses (including taxes and production costs) and since I had a fast turn over of items it didn't seem to matter weather or not those costs were included when calculating total assets.
But, seeing how I am in the negative =p I tried to think about it from an accounting point of view. As far as the worth of total assets goes: I make isk when I buy minerals, I lose isk when I use those minerals to manufacture items, I also lose isk when I put those items into sell orders, and of course I make isk when items sell. What this means, is that if total assest are at 1bil, but most of it is in minerals, it isn't "worth" as much as the same total assets of 1bil if most of it was in sell orders (or items in production) This still doesn't explain why I am 50mil in the negative, I know I didn't have 25bil worth of stuff go through sell orders, and mineral pile remained at nearly the same value.
So, anyone has any suggestions on how to improve the way I calculate total assets? specifically the way to calculate items in production and sell orders.
PS: Extra points for anyone who reads the whole post 
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