3.5 assessing competitiveness Flashcards
what does a statement of comprehensive income show?
- revenue
- costs of sales
- gross profit
- operating profit
- tax
- net profit
what key information does the statement financial position show?
- non-current assets
- current assets
- current liabilities
- net current assets
- non current liabilities
- net assets
- total equity
what will total equity always equal to?
- net assets
what do we find out from a statement of financial position?
- value of a business (equity)
- the current assets they hold
- short term liabilities they need to pay
- the liquidity of a business
- long term debts
- how they’ve been financed
what is the return on capital employed (ROCE) ratio?
operating profit
———————– X100
capital employed
how can you improve ROCE ratio?
- increase operating profit
- reducing capital employed
formula for capital employed?
total equity + non current liabilities
what is the gearing ratio formula?
non-current liabilities
——————————- X100%
total equity + non current liabilities
what does the gearing ratio show?
- how a business has raised its long term finance
formula for labour productivity?
number of employees at work
what is a disadvantage of using labour productivity as an indicator of performance?
- doesn’t take into account wage rates;a key factor in employee performance
- doesn’t take into account technology used
- may be affected by other factors e.g. nature of task, internal disputes
formula for labour turnover?
average No of staff
formula for absenteeism?
total employees
what does high level of absenteeism cause and show?
- increases cost
- indicator of demotivation or tensions
what are HR stategies?
- methods of motivating employees in order to increase business performance
