GVA GVA GVA G ross O utput is the value of total sales G ross V alue A dded is the value of the final sale THE TURNOVER FORMULA Alternatively it can be presented ID: 730784
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Slide1
G.O. + (G.O - G.V.A.)G.V.A. G.V.A.
Gross Output is the value of total salesGross Value Added is the value of the final sale
THE TURNOVER FORMULASlide2
Alternatively it can be presented: G.O. + I.S. G.V.A. G.V.A. where I.S.
stands for intermeditate sales.Slide3Slide4
PROOFS.1. Cost of sales/(current assets – current liabilities)2. Value of inventory + credit given – credit received.3. Days of inventory plus (days of credit/mark up).Slide5
Annual gross output less net surplus= annual cost of gross output.(but this is not to be confused with working capital)Slide6
Working capital =annual cost of gross output annual rate of turnoverSlide7
annual compensation = VARIABLE CAPITALannual rate of turnoverSlide8
constant capital = COMPOSITION variable capitalSlide9
s/c+v is not as accurate asS/FIXED + CIRCULATING CAPITALSlide10
THE REALIZATION CRISISis really aTURNOVER CRISISSlide11
IT IS THE DECELERATION IN TURNOVERwhich converts a relative fall in the rate of profit
into an absolute fall.Slide12
Producer
input
+ Value added
= value of saleSale number
farmer
0
10
10
(1)
miller
10
10
20
(2)
baker
20
10
30
(3)
cafe
30
10
40
(4)
TOTAL
60
40
100
Intermediate= 60
Final sale =
GVA
= 40
Gross Output = 100
Slide13
Intermediate
+ final sale
= gross output
calculation
compensation
surplus
300
100
400
50
50
400 – 50 = 350
(GO – surplus
)
300 + 50 = 350
(
IS + compensation)