all equations

Question 1

ROCE

Answer 1

(operating profit/ capital employed) x 100

Question 2

capital employed

Answer 2

current assets - current liabiliites

Question 3

gross profit

Answer 3

revenue- cogs

Question 4

cogs

Answer 4

opening inventory + purchases - closing inventory

Question 5

gross profit margin

Answer 5

(gross profit/ sales revenue) x 100

Question 6

operating profit margin

Answer 6

(operating profit/ sales) x 100

Question 7

non-current asset turnvover ratio

Answer 7

sales/ non-current assets

Question 8

average receivables collection period

Answer 8

(trade recievables/ credit sales) x 365

Question 9

average payables payment period

Answer 9

(trade payables/ credit purchases) x 365

can use cogs instead of purchases

Question 10

inventory holding period

Answer 10

( inventory/ cogs) x 365

Question 11

net trade cycle

Answer 11

inventory holding period + recievables collection period - payables payment period

Question 12

contribution per unit

Answer 12

SP-VC

Question 13

total contribution

Answer 13

contribution per unit x number of units sold

Question 14

contribution margin

Answer 14

(total contrubtion/ total revenue) x 100

Question 15

break even units

Answer 15

FC/ SP - VC

Question 16

profit using contribution

Answer 16

total contribution - FC

Question 17

margin of safety

Answer 17

(actual units sold - break even units/ actual units sold) x 100

Question 18

accounting rate of return

equation

Answer 18

(operating profit/ average capital employed) x 100

Question 19

operating profit in long-term

equation

Answer 19

total profit/ no. of years of project

Question 20

average capital employed in long-term

equation

Answer 20

cost + scrap value/ 2

Question 21

operating profit long-term if you get given cash flow

equation

Answer 21

total cash - (cost- scrap)/ no. of years of project

Question 22

Overheads

2.apportion indirect costs to cost centres

equation

Answer 22

size of section/ total size of org x e.g rent bill

Question 23

overheads

3.reapportion service department costs to production departments

equation

Answer 23

hours of time used of section/ total hours worked by section x bill sharing out

add on labour

Question 24

overheads

overhead absorption rate

equation

Answer 24

total overheads/ no. of hours worked = £… per hour