A firm reports its revenue to investors, industry regulators and the Securities and Exchange Commission (SEC) on a quarterly and annual basis. Revenue is the total income a firm earns from sales, trading, investing and other business activities. Calculations of revenue are essential to figuring other measurements of the firm's performance, such as its profits and profit margins. To represent and calculate revenue graphically, an investor should acquire the firm's earnings statement for a particular quarter or year, then input the data into a computer spreadsheet to generate graphs and calculations.
1. Download a firm's earnings statement from the investor relations section of its website. Publicly-traded companies also file their earnings statements and quarterly and annual reports with the SEC. Though an earnings statement lists and itemizes a firm's sources of revenue, it also contains analysis and commentary from the firm's leaders.
2. Locate the table in which the firm states its revenue. In addition to reporting total revenue for a financial quarter or year, the earnings statement also compares the firm's current performance to its performance throughout the year and in the same quarter of the previous year. The table will itemize the sources of a firm's revenue, including sales, franchising fees, tax breaks and investments.
3. Create a similar table using a computer spreadsheet. Name each source of revenue in one column of the spreadsheet, then list its corresponding value in the column next to it. Label the cell below each itemized revenue source as "Total Revenue".
4. Automatically calculate the firm's total revenue using the computer spreadsheet's formula for automatically summing data. When selecting the range of data to total, select each cell that contains a measurement of the firm's revenue. The spreadsheet's formula will total the firm's revenue based upon its sources of revenue.
5. Highlight all of the revenue data you have entered into the spreadsheet by clicking one cell then dragging your cursor across the entire data field. Click the icon or menu option that instructs your spreadsheet to create graphs. The command will vary based upon your spreadsheet program, though many programs signify this command on the home menu using an icon of a bar graph.
6. Choose the type of graph -- pie graph, doughnut graph or bar graph, for example -- that best represents your data; this decision could be a matter of preference. Instruct the program to generate a graph based on the revenues you have entered. Each revenue source will be represented as a percentage of the total revenue and will be totaled to represent the firm's total revenue for a period of time.
- Expand your graphic representation of revenue data by totaling the revenue for a firm's competitors and for the market in which it competes. Comparing a firm's revenue to that of its competition and its entire market creates context for the firm's performance.
Items you will need
- Earnings statements
- Computer spreadsheet
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