CONTENTS S.

NO 1 2 3 4 5 6 7 8 CHAPTERS
INTRODUCTION OF THE RESEARCH PROBLEMS RATIONALE OF THE STUDY REVIEW OF LITERATURE RESEARCH OBJECTIVE RESEARCH METHODOLOGY ANALYSIS LIMITATION OF STUDY

PAGE NO. 2 3 3-5 6 7 8 8 9

BIBLOGRAPHY

INTRODUCTION OF THE RESEARCH PROBLEMS

In the present scenario real estate company facing many problem like increasing price of raw material, various government policies ,increasing completion etc. which affect the profitability of the company. In this research report profitability is analyze during this period. Profitability Analysis enables you to evaluate market segments, which can be classified according to products, customers, orders or any combination of these, or strategic business units, such as sales organizations or business areas, with respect to your company's profit or contribution margin. The aim of the system is to provide your sales, marketing, product management and corporate planning departments with information to support internal accounting and decision-making. Two forms of Profitability Analysis are supported: costing-based and account-based. 1. Costing-based Profitability Analysis is the form of profitability analysis that groups costs and revenues according to value fields and costing-based valuation approaches, both of which you can define yourself. It guarantees you access at all times to a complete, short-term profitability report. 2. Account-based Profitability Analysis is a form of profitability analysis organized in accounts and using an account-based valuation approach. The distinguishing characteristic of this form is its use of cost and revenue elements. It provides you with a profitability report that is permanently reconciled with financial accounting.

In the business cycle, the achievement of an appropriate profit level, or profitability, is very important for a firm's survival and growth. Profitability is said to be a function of three factors. (1)sales volume (or work done), sometimes called turnover. (2)the capital investment necessary to support. (3)the margin of profit earned. Profitability may be expressed as a profit percentage of turnover (POT) or return on capital investment (ROI). (Turnover here has the same meaning as sales volume while the return is gross profit).

RATIONALE OF THE STUDY

The study is based on the analysis of the balance sheet and ABC analysis of the company and techniques are also accounting based ratio analysis, data are collected from a tally record and also collected the data from different department of Supertech (real estate company) so it have hundred per cent accuracy.

REVIEW OF LITERATURE
Profitability analysis
Profitability analysis involves examining the relationships between revenues, costs, and profits. Performing profitability analysis requires an understanding of selling prices and the behavior of activity cost drivers. (Activity cost driver is often referred to as cost driver when the context is clear that we are discussing activity, rather than structural or organizational, cost drivers.) Profitability analysis is widely used in the economic evaluation of existing or proposed products or services. Typically, it is performed before decisions are finalized in the operating budget for a future period. Paralleling our examination of cost behavior, we examine two approaches to profitability analysis. 1. A unit-level approach based on the assumption that units sold or sales dollars is the only activity cost driver. 2. A cost hierarchy approach that incorporates no unit and unit-level activity cost drivers. The traditional approach to profitability analysis, which considers only unit-level activity cost drivers, is identified as cost-volume-profit (CVP) analysis. It is a technique used to examine the relationships among the total volume of an independent variable, total costs, total revenues, and profits for a time period (typically a quarter or year). With CVP analysis, volume refers to a single unit-level activity cost driver, such as unit sales, that is assumed to correlate with changes in revenues, costs, and profits. Cost-volume-profit analysis is useful in the early stages of planning because it provides an easily understood framework for discussing planning issues and organizing relevant data. CVP analysis is widely used by for-profit as well as not-for-profit organizations. It is equally applicable to service, merchandising, and manufacturing firms.

Profit Formula
The profit associated with a product, service, or event is equal to the difference between total revenues and total costs as follows: Profit where R = Total revenues Y = Total costs = R-Y

The revenues are a function of the unit sales volume and the unit selling price, while total costs for a time period are a function of the fixed costs per period and the variable costs of unit sales as follows: R = pX Y = a - bX where p =Unit selling price a =Fixed costs b = Unit variable costs X = Unit sales In determining the break-even point, the equation for total revenues is set equal to the equation for total costs and then solved for the break-even unit sales volume. Using the general equations for total revenues and total costs, the following results are obtained. Setting total revenues equal to total costs: Total revenues = Total costs pX =a + bX

Break-even unit sales volume =

Fixed costs Selling price per unit -Variable costs per unit

FINANCIAL STATEMENTS
Financial statements (or financial reports) are formal records of the financial activities of a business, person, or other entity. Financial statements provide an overview of a business or person's financial condition in both short and long term. All the relevant financial information of a business enterprise, presented in a structured manner and in a form easy to understand is called the financial statements. There are four basic financial statements: 1. Balance sheet: It is also referred to as statement of financial position or condition, reports on a company's assets, liabilities, and Ownership equity as of a given point in time. 2. Income statement: It is also referred to as Profit and Loss statement (or "P&L"), reports on a company's income, expenses, and profits over a period of time. Profit & Loss account provide information on the operation of the enterprise. These include sale and the various expenses incurred during the processing state. 3. Statement of Retained Earnings: It explains the changes in a company's retained earnings over the reporting period. 4. Cash Flow Statement: It reports on a company's cash flow activities, particularly its operating, investing and financing activities.

RESEARCH OBJECTIVE

1. Explain the meaning, need and purpose of Profitability analysis. 2. To analysis the production activity. 3. To prescribe the financial accounting design to provide the financial information necessary to manage the profitability analysis of organization. a) To find out Expenses of company. b) To find out Depreciation. c) To find out Costing of Project. d) To find out Revenue of company. e) Break-even analysis. 4. Prepare the profit and loss account. 5. To focus on financial annual report of profitability analysis. a) Net sales profitability b) Profitability ratio c) Assets turnover d) Equity ratio 6. Analyze the risk associate with profitability analysis. 7. To provide the guidelines for development of capital budget. 8. Policies and planning set out by the help of profitability analysis within which the transaction are made.

RESEARCH METHODOLOGY

EXPLORATORY RESEARCH
It is used here in the study as we know the symptoms and do not know the factors. This type of research will help us to find out the root cause and its affects for the symptoms. The findings of the research can be used for making interpretations or can be used in future researches.

DETAILS AT DATA COLLECTION: The data for this work were obtained mainly from a tally record and also collected the data from different department of Supertech (real estate company) . Basically types of data collected are. Primary Data Primary research consists in research to collect original primary data. It is often undertaken after the researcher has gained some insight into the issue by collecting secondary data. This can be through numerous forms, including questionnaires, direct observation and telephone interviews amongst others. The term primary research is widely used in academic research, market research and competitive intelligence. Secondary data It means the already available i.e. they refer to the data which has already been collected and analyzed by someone else. Various publications, books, newspapers, journals, magazines, Internet, have done the collection of secondary data. By way of caution the researcher before using data must see that they possess following characteristics Reliability of data Suitability of data Adequacy of data

ANALYSIS

PROFITABILITY ANALYSIS Ratio analysis is a very important tool of profitability analysis. It is the process of establishing a significant relationship between the items of financial statements to provide a meaningful understanding of the performance and financial position of a firm. Financial statement analysis tend to figure out the FINANCIAL HEALTH of Organization by using ratio analysis techniques. These techniques are used by investorsto find out the operational effectiveness and efficiency with which resources are being utilized by a firm. This in turn lets the investors find out whether a venture or an investment in that firm's stock would be profitable. Software Use I will use the following software for this analysis. 1. Tally 9 2. Microsoft Office

LIMITATIONS OF STUDY:The limitations of the study are: Time constraint. confidential data due to privacy and secrecy of the organization.

Bibliography: Khan, M.Y. (1988). Financial Management, Tata Mc-Graw Hill , New Delhi, Bhattacharya, Asish. K. (2007). Introduction to Financial Statement Analysis, Elsevier, New Delhi ,

Web References:
1.www.vvipspaces.com 1. http://en.wikipedia.org/wiki/Asset 2. http://en.wikipedia.org/wiki/Liability_%28financial_accounting%29 3. http://en.wikipedia.org/wiki/Secured_loan 4. http://en.wikipedia.org/wiki/Financial_statement 5 . http://en.wikipedia.org/wiki/Unsecured_loan