What is required to calculate profitability of projects in Xero Projects?

To calculate the profitability of projects in Xero Projects, having staff cost rates is essential. Staff cost rates provide the necessary financial information regarding the expenses incurred for labor associated with the project. By understanding how much each staff member costs to employ on a per-hour basis, you can accurately assess the total costs of the project.

When these cost rates are combined with income generated from the project, it allows for a clear comparison between revenue and expenses, thus determining the overall profitability. Without this data, a true picture of financial performance cannot be attained since the calculation of profitability relies on understanding both income and direct costs associated with employee labor involved in project tasks. This is why having precise staff cost rates is critical for effective project profitability analysis in Xero.