BEC Formulas Flashcards
To study Formulas for BEC CPA Exam
Asset Turnover
Total Sale/Avg. Assets
Predetermined Overhead Rate
Est. Manufacturing OH Cost/ Est. # of Machine Hours
Times int earned
Ebit/int exp
Defensive interval ratio
(Cash + mar security + net ar)/avg daily cash exp
Ar turnover
Net credit sales/avg net receivables
Return on total assets
(Net income + int exp) / avg total assets
Return on total assets
(Net income + int exp) / avg total assets
of days supply in avg inventory
Avg inventory/avg daily cogs or 360/inventory turnover
Length of operating cycle
of days sales in Ar + # of days supply in avg inventory
Book value per cs
Common shareholders equity/ # cs o/s
Return on cs equity
(Net income - preferred dividend)/ avg common stockholders equity
Return on stockholders equity
Net income/ avg stockholders equity
Eps
(Net income - preferred dividend ) / avg # of cs outstanding
Yield on cs
Dividend per cs / market price per cs
Price earnings ratio
Mp per cs/ earnings per cs
Dividend payout ratio
Cash dividend per cs / earnings per cs
Avg investment
(Initial investment + nwc + residual value) / 2
Discount rate aka
Hurdle rate or min rate
Benefits per check in lockbox
Days saved in collection period × avg check size × daily interest or opportunity cost
Total benefit in dollars
Per check amt×Days of float reduced×annual rate of interest
Break even in dollars for check received
Fee amt per check/ per day int × per day added
Reorder pt
Avg lead time×daily demand+ safety stock
Safety stock
(Max lead time - avg lead time)×daily usage
Social security from eyes of employee
Regressive
Roi
Operating income / avg invested capital
Residual income
Operating income - (imputed int charge on avg invested capital)
Coefficient of determination is strongest
As it approaches -1 Or 1 and weakest as it approaches 0
Accrual Accounting Rate of Return
Average Annual Income the project generates / initial or average increase in required investment
Nat’l Income
GDP - Dep=Net domestic product - indirect business taxes + income earned abroad=nat’l income
Dividend Growth Rate Model
Cost of equity = dividend 1 year from now/ market price + growth rate
Operating Profit Margin
EBIT/Sales
Operating Leverage
% Change in Operating Income/% change in sales volume
Degree of Operating Leverage
Contribution Margin/EBIT
Degree of financial leverage
Ebit/(ebit-interest)
Ordering costs include
quantity discounts lost, shipping costs, purchasing costs, and, in a manufacturing facility, set-up costs for production runs.
Carrying costs include
handling, interest on invested capital, storage costs, and obsolescence.
