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Year 2 Semester 2 > Accounting Formulae > Flashcards

Accounting Formulae Flashcards

1
Q

gross profit margin

A

gross profit / revenue x 100

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2
Q

gross profit

A

revenue - cost of sales

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3
Q

profit margin

A

operating profit / revenue x 100

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4
Q

ROCE

A

profit before interest & tax (operating profit) / capital employed x100

operating profit / debt + equity

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5
Q

capital employed

A

total assets - current liabilities

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6
Q

current ratio

A

current assets / current liabilities

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7
Q

collection days ratio (receivables collection period)

A

(trade receivables x 365) / revenue

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8
Q

trade payables ratio (payables payment period)

A

(trade payables x 365) / COS

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9
Q

Inventories turnover (inventory holding)

A

(inventory x 365) / COS

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10
Q

dividend yield

A

(dividend per share / current share price) x 100

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11
Q

P/E ratio

A

Share prices / EPS

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12
Q

Dividend cover

A

EPS / Dividend per share

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13
Q

Operating cycle

A

Trade receivable days - Trade Payable days + Inventory days

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14
Q

asset turnover

A

revenue / capital employed

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15
Q

ROE

A

profit after tax less preference divided / equity invested in company

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16
Q

quick ratio

A

(current asset - inventory) - current liabilities

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17
Q

debt to equity

A

debt / equity

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18
Q

gearing

A

debt / debt + equity

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19
Q

interest coverage

A

profit before interest & tax / interest payable

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20
Q

EPS

A

earnings / no. of shares

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21
Q

dividend payout ratio

A

dividend for year / EPS

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22
Q

cash flow per share

A

(CFO - Preferred Dividends) / No. of common shares outstanding

23
Q

cash flow to revenue

A

CFO / Net revenue

24
Q

cash return on assets

A

CFO/ Total assets

25
cash return on equity
CFO / SHs equity
26
cash to income
CFO / Operating income
27
5 Cash flow performance ratios
1. Cash flow per share 2. Cash flow to revenue 3. Cash return on assets 4. Cash return on equity 5. Cash to income
28
6 Cash flow coverage ratios
1. Debt coverage 2. Debt payment 3. Dividend payment 4. Interest coverage 5. Investing and Financing 6. Reinvestment
29
Debt coverage
CFO / Total debt
30
Debt payment
CFO / Cash paid for LT debt repayment
31
Dividend payment
CFO / Dividends paid
32
Interest coverage
(CFO + interest paid + taxes paid) / Interest paid
33
Investing and financing
CFO / Cash outflows for investing and financing activities
34
Reinvestment
CFO / Cash paid for long term assets
35
Free cash flow to the firm
CFO + Interest expense x (1-Tax rate) - Fixed capital investments
36
Free cash flow to equity
CFO - fixed capital investment + Net new borrowing (or minus net debt repayment)
37
materials - inventory - continual use
have to replace RC = current mkt price
38
materials - inventory - no other use
take from inventory RC = zero/sales value forgone/scrap value
39
materials - inventory - scarce
RC = opportunity cost of not using for alternative opportunity
40
materials - not in inventory - have to buy it
RC = current mkt price
41
labour - full capacity & hire more
RC = current market price
42
labour - spare capacity
RC = zero
43
labour - full capacity & cant hire more
RC = opportunity cost of not using labour/alternative opps
44
Sales volume variance
( Actual sales volume - budgeted sales volume ) x standard profit Standard profit - contribution per unit
45
Sales price variance
( Standard price - actual price ) x actual volume
46
Materials price
( standard price - actual price) x actual quantity
47
Materials usage (quantity)
( Standard quantity - actual quantity ) x standard price
48
Labour rate
( standard rate - actual rate) x actual labour hours
49
Labour efficiency
( standard hours - actual hours) x standard rate
50
Fixed production volume
( actual production - budgeted production ) x fixed overhead absorption rate
51
Fixed overhead expenditure
( budgeted overhead - actual overhead)
52
Variable expenditure
( standard rate - actual rate) x actual hours
53
Variable efficiency
( standard hours - actual hours) x standard rate

Year 2 Semester 2 (16 decks)

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