The index of physical volume is used along with other economic indicators for objective assessment of efficiency of production policy of the enterprise. This concept characterizes change of turnover of products for the reporting period in comparison with last.
Instruction
1. Specialists of economic department of any enterprise use the index system of the analysis of primary activity. Economic indexes act as comparative characteristics on time and are relative sizes of dynamics of the processes connected with production and product sales.
2. The index of physical volume characterizes process of change of size of goods turnover. As temporary parameters for comparison data for two periods, reporting (current) and basic are used. As a rule, it is the annual period, is more rare – quarter.
3. The reporting period is the period of time which passed from the moment of the last calculations to period closing day inclusive. The basic period is an interval of time in the past for which data were already counted and submitted in previous or earlier reports.
4. To define the index of physical volume, use data of goods turnover, namely quantity of units of production. As the enterprises often release not one, and several descriptions of goods, sizes multiply by the prices and put by types of products.
5. The formula of the index of physical volume looks as follows: Iv = Σ(N1*C0)/Σ(N0*C0) where N1 and N0 is quantity of units of production which were realized for the reporting and basic period respectively; c0 are the prices of the basic period.
6. The prices of the basic period act in definition of the index of physical volume as characteristic which allows to correlate incommensurable sizes. Simple comparison of volumes of all goods for both periods will not yield the correct result since the products are turned out several types.
7. Let's assume, for example, that the enterprise releases sports equipment: skis, skates and sledge. Then it will be correct to define the index of physical volume so: Iv = (Nl1*Cl0 + Nk1*Ck0 + Nc1*Cc0) / (Nl0*Cl0 + Nk0*Ck0 + Nc0*Cc0).