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How to Calculate a Percentage Decrease in Revenue From Year to Year

Original post by C. Taylor of Demand Media

If your revenues have degraded from a previous year, you might want a reliable way to track this decrease. Pure numbers won't do it, because they are meaningless without a reference. As an example a $10,000 reduction might be significant for a very small firm, but if revenues are generally $20 million for a larger business, this reduction is a drop in the bucket. Percentages are a better gauge of how much revenue has been lost compared to the previous year.

Step 1

Subtract the current year's total revenue from the previous year. If the number is negative, then you know you had a loss. For example, if the current year's revenues were $200,000, but last year they were $250,000, then revenue is down $50,000 from the previous year.

Step 2

Divide the change in revenue by the previous year's total revenue. In the example, $50,000 divided by $250,000 equals .20.

Step 3

Multiply this number by 100 to convert the figure into percentage format. In the example, the 0.20 change represents a 20 percent decrease in revenue.

                   

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About the Author

C. Taylor has been a professional writer since 2009. He has written for online publications and the "Journal of Asian Martial Arts." Taylor specializes in martial arts, traveling, sciences and computer repair. He received a Master of Science in wildlife biology from Clemson University and a Bachelor of Arts in biological sciences from the College of Charleston.

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