SQL Code Explanation

Overview

The provided SQL code snippet calculates the profit for the year 2022 by subtracting the total expenses from the total sales revenue for that year. It utilizes subqueries to separately calculate the sums of sales and expenses.

Code Breakdown

SELECT
    (SELECT SUM(Sale_Amount) FROM sales WHERE DATE_FORMAT(Sale_Date, '%Y') = '2022') -
    (SELECT SUM(Expense_Amount) FROM expenses WHERE DATE_FORMAT(Expense_Date, '%Y') = '2022') AS Profit

1. Query Structure

• Outer SELECT Statement: Initiates the query and defines what will be returned.
• Subqueries: There are two subqueries within the SQL query, each enclosed in parentheses.

2. Subquery for Sales

(SELECT SUM(Sale_Amount) FROM sales WHERE DATE_FORMAT(Sale_Date, '%Y') = '2022')

• Purpose: This subquery calculates the total sales amount for the year 2022.
• Components:
  • SUM(Sale_Amount): This function sums up all values in the Sale_Amount column.
  • FROM sales: Specifies the table from which to retrieve data, in this case, the sales table.
  • WHERE DATE_FORMAT(Sale_Date, '%Y') = '2022': This condition filters the rows to include only those where the Sale_Date falls within the year 2022. DATE_FORMAT is used to extract the year part of the date.

3. Subquery for Expenses

(SELECT SUM(Expense_Amount) FROM expenses WHERE DATE_FORMAT(Expense_Date, '%Y') = '2022')

• Purpose: This subquery calculates the total expense amount for the year 2022.
• Components:
  • SUM(Expense_Amount): This function computes the total of the Expense_Amount column.
  • FROM expenses: Specifies the data source as the expenses table.
  • WHERE DATE_FORMAT(Expense_Date, '%Y') = '2022': Filters the rows for those where the Expense_Date is in the year 2022.

4. Profit Calculation

• Profit Calculation: The main operation here is the subtraction of the total expenses from the total sales:

  Total Sales - Total Expenses

• Result Alias: The result of the calculation is labeled as Profit using the AS keyword.

Key Concepts

Subqueries

• Definition: A subquery is a query nested within another SQL query. It can return a single value (as in this case) or multiple rows.
• Usage: Useful for breaking down complex queries into smaller, manageable parts.

Aggregate Functions

• Aggregate Functions: Functions like SUM(), AVG(), etc., allow you to perform calculations on a set of values and return a single value.

Date Functions

• DATE_FORMAT: This function is utilized to format date values. Here, it retrieves the year from a date for comparison.

Additional Example

The same result could be achieved using Common Table Expressions (CTEs) for better readability:

WITH TotalSales AS (
    SELECT SUM(Sale_Amount) AS TotalSales 
    FROM sales 
    WHERE DATE_FORMAT(Sale_Date, '%Y') = '2022'
),
TotalExpenses AS (
    SELECT SUM(Expense_Amount) AS TotalExpenses 
    FROM expenses 
    WHERE DATE_FORMAT(Expense_Date, '%Y') = '2022'
)
SELECT (TotalSales.TotalSales - TotalExpenses.TotalExpenses) AS Profit
FROM TotalSales, TotalExpenses;

Benefits of Using CTEs

• Readability: CTEs can make the SQL code easier to read and maintain, especially when multiple calculations are needed.
• Reusability: You can reference the CTEs multiple times within the main query.

Conclusion

The SQL query effectively computes profit by using subqueries to isolate sales and expenses for a specific year. Understanding the structure and components of this query lays a foundation for more complex SQL operations that involve aggregation, filtering, and nested queries. This query exemplifies a common financial analysis task in data science and operations management. For further learning, consider exploring courses on the Enterprise DNA Platform that enhance knowledge in SQL and data analysis techniques.