Revenue calculation - actual fee (X) or the amount received after giving them the commission of 10%? - CiteHR
Dinesh Divekar
Business Mentor, Consultant And Trainer
Aniket Pathak
Sr. Executive Hr

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I am working with an education sector company which provides lab setup and tech courses to schools. So, let's say if a student is paying X amount as the course fee, and school is taking 10% as a commission from amount X. I would like to know if our revenue will be considered as the actual fee (X) or the amount received after giving them the commission of 10%? Appreciate your sooner help on this, thanks.
school fees is revenue and 10 % is profit.
Dear Aniket,
Thanks a lot for your reply, Could you please help me clarify this more given this scenario as an example, (Our course fee is 100 INR per student, we approach schools to enrol their students, in return the school takes a commission of 10 INR per student and pay us 90 INR per student; So our revenue will be considered as 90 INR or 100 INR?

Dear Anonymous,
I don't know why you have confused with the basics of business. You have to raise an invoice for the services that you provide to the customer. When the customer pays as per your invoice, then it becomes your "revenue".
When the school student pays Rs 100/- to the school, then it becomes revenue of the school. However, you have understanding with the school to pay 10% as the commission. Therefore, you have to raise an invoice for Rs 90/- and when you receive this amount, it is your revenue.
Thanks,
Dinesh Divekar

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