Accounting & Finance Flashcards
Total costs equation
Fixed + variable cost
Unit costs equation
Total cost / output
Revenue equation
Price x quantity sold
Contribution per unit equation
Price - variable cost
Break Even equation
Fixed costs / contribution
Margin of Safety equation
Actual sales - break even sales
Average Rate of Return equation
Annual average profit / cost of investment x 100
Net Cash Flow equation
Total inflows - total inflows
Gross profit equation
Sales revenue - costs of sales
Operating profit equation
Gross profit - expenses
Profit before tax equation
Operating profit - finance costs
Profit for the year (Retained profit)
Net profit - tax and dividends
Net Current Assets (Working Capital)
Current assets - current liabilities
Net Assets equations
Total assets - total liabilities
Straight Line Depreciation equation
Initial cost - residual value / life of asset
Current Ratio equation
Current assets / current liabilities
Acid Test equation
Current assets - inventory (stock) / current liabilities
Gearing equation
Non current liabilities/ capital employed x 100
Debt to Equity Ratio equation
Debt / equity x 100
Interest Cover equation
Operating profit / interest payable (finance costs)
Asset Turnover equation
Revenue / non-current assets
Stock Turnover equation
Cost of stock / average stock
Debtor Days equation
Trade receivables / revenue x 365
Creditor Days equation
Trade payables / cost of sales x 365
Gross Profit Margin equation
Gross profit / sales revenue x100
Net Profit Margin equation
Net profit / sales revenue x 100
ROCE (Return on Capital Employed) equation
Operating profit / capital employed x 100
Return on Equity equation
Profit for the year / shareholders equity
Dividend per share equation
Total dividends paid / number of shares issued
Dividend Yield equation
Dividend per share / market price of share x 100
Earnings per share equation
Profit for the year / number of shares issued
Price Earnings Ratio equation
Market price of share / earnings per share
