Cost and Profit Calculations

A majority of the Wrap-Up screen is dedicated to showing details of your vehicle costs and the calculation of a profit on the sale. The vehicle cost figures are taken directly from the inventory screens, and the deal price and cost figures come directly from the deal screens. Many of the cost figures as well as the boxes labeled Dealer Incentives, Actual Cash Value, and Dealer Rate can be changed directly on the screen.

Note: Changing vehicle cost information on this screen will not update the cost information on the vehicle itself. This is a feature provided solely for the convenience of dealers who wish to enter different information to conform to special in-house business rules, and it is not recommeded that you change these figures.

Calculating a Front-End Profit

The front-end profit is the profit calculated in the top portion of the screen. It is the selling price of the vehicle minus the immediate costs of the vehicle. Also included in this calculation is any compenstation you receive in the form of dealer incentives and the net value of the trade-in vehicle. The trade-in value is calculated by taking taking the difference of the amount you gave the customer for the trade and the amount the trade is actually worth (labeled Actual Cash Value).

The values for the Base Cost, Repair Orders, Option Costs, PAK, and Other Costs boxes come from the Inventory Detail screens. The value for the Actual Cash Value box comes from the Financial tab of the deal screens.

Calculating a Back-End Profit

The back-end profit is the profit calculated in the bottom portion of the screen. It is the amount of money made from the sale of optional items such as a warranty or GAP insurance. The Sale Price column lists the amount for which you sold each of these items to the customer, and the value in each box of this column will come from the deal screens. The Cost column will need to be filled in by you directly on this screen.

The software can also calculate a reserve on the finance charge when the deal is financed. Enter your dealership's buy-rate for the financing into the box labeled Dealer Rate. The software will then calculate the amount of reserve owed to you based upon information you supplied when setting up the finance source used for this deal. If you wish, you can type a dollar amount for your expected reserve directly into the software and override the software's calculations. Simply type this amount into the Override box.

You can also keep track of when this deal was actually funded by the bank by typing the funding date into the Funding box.

Calculating the Expected Gross Profit

The expected gross profit is simply the sum of the front-end profit and the back-end profit.