All Business Formulas Flashcards
Market Share
Business’s total sales/Total sales in whole market
Market Growth
Market size year 2 - Market size year 1 / Market size year 1 x 100
YED
% change in quantity demanded / % change in income
PED
% change in quantity demanded / % change in price
Sales growth
Sales year 2 - Sales year 1 / Sales year 1 x 100
Expected value
(Probability success x pay off) + (probability failure x pay off)
Net gain
Expected value - cost of choice
Profit
Total revenue - Total costs
Revenue
Selling price x quantity sold
Fixed costs
Total revenue - Total variable costs - profit
Variable costs
Total revenue - Total fixed costs - profit
Total costs
Fixed + variable costs
Market capitalisation
Number of shares sold X share prices TODAY
Capacity Utilisation
Current Capacity / Maximum Total Capacity x 100
Average unit costs
Total costs / Total Output
Labor Productivity
Total Output / Number of Employees
Break-Even (1)
Total Revenue = Total costs
Break Even (2)
Fixed costs / Contribution
Contribution per unit
Selling price - variable cost per item
Margin of safety
Actual sales - break-even level of sales
Gross profit
Revenue - Cost of Goods old (basically variable costs)
Gross profit margin
Gross profit / revenue X 100
Operating profit
Gross profit - Operating expenses
Operating profit margin
Operating profit / Revenue X 100
Profit for the year
Operating profit - All expenses (including taxation)
Profit for the year margin
PFTY / Revenue X 100
Labour turnover
Number of staff leaving / Number of staff employed by the business x 100
Employee costs as a % of turnover
Employee costs / Turnover (sales revenue) x 100
Labour costs per unit
Labour costs / Units of output
ROI
profit (or loss) / initial investment
ROCE
Operating Profit / Capital Employed X 100
Capital Employed
Total Equity + Non-Current Liabilities
Total Equity
Total assets - total liabilities
Current ratio
current assets / current liabilities
Gearing
Non Current liabilities / total equity + non current liabilities x100
Payables days
Costs of sales / payables X 365
Receivables days
Revenues / Receivables X 100
Inventory turnover
costs of sales / average inventory
Net cash flow
Inflows - outflows
opening balance
closing balance from the previous year
closing balance
Net cash flow + opening balance
