Book 1

Question 1

How do you calculate Total Revenue?

Answer 1

Price per unit X Quantity of units sold.

Question 2

How do you calculate Total Costs?

Answer 2

Fixed costs + Variable costs

Question 3

How do you calculate profit?

Answer 3

Total revenue - Total Costs

Question 4

How do you calculate market capitalisation?

Answer 4

Total outstanding shares X current market price of an individual share

Question 5

How do you calculate the expected value

Decision trees

Answer 5

Value of the outcome X profitability

Question 6

How to calculate net gain

Decision trees

Answer 6

Both expected values added together = Total expected value TEV
TEV - Cost =net gain

Question 7

How to calculate sales value

Answer 7

Volume X average price

Question 8

What is the formula for market growth as a %?

Answer 8

Market size in year - market size in previous year
—————————— market size in previous year

X 100

Question 9

Formula for sales growth

Answer 9

Sales in that year - sales in previous year
————————–sales in previous year

X 100

Question 10

Formula for market share

Answer 10

Total sales in the market

X 100

Question 11

Formula for price elasticity of demand

Answer 11

% change in price

Question 12

Formula for income elasticity of demand

Answer 12

% change in income

Question 13

Formula for % change in quantity demanded

Answer 13

Original quantity demanded

X 100

Question 14

Formula for % change in price

Answer 14

Original price

X 100

Question 15

What is the formula for unit costs?

Answer 15

Units of output

Question 16

How to calculate punctuality

Answer 16

Total deliveries

X 100

Question 17

Formula for added value

Answer 17

Sales revenue - cost of bought-in materials, components and services

Question 18

How is labour productivity calculated?

Answer 18

Number of employees per period

Question 19

How to calculate capacity utilisation?

Answer 19

Actual output per annum
(Month)
————————–
Maximum possible output per annum (month)

X 100

Question 20

Formula for Return on investment as a %

Answer 20

Cost of the investment

X 100

Question 21

What is the calculation for Return on investment?

Answer 21

Financial gains from the investment - Costs of the investment

Question 22

Formula for debts as a proportion of long term funding

Answer 22

Long term funding

X 100

Question 23

Formula for gross profit

Answer 23

Revenue - cost of sales

Question 24

Calculation for Operation profit

Answer 24

Gross profit (revenue-cost of sales) - administrative expenses

Question 25

What is the formula for Profit for the year

Answer 25

Operating costs - net finance - taxation

Question 26

Calculate profit budget

Answer 26

Income - expenditure

Question 27

How do you calculate variance

Answer 27

Budget figure - actual figure

Question 28

How to calculate net cash flow

Answer 28

Cash inflows - cash outflows

Question 29

Formula for closing cash balance

Answer 29

Opening cash balance + net cash flow

Question 30

Calculate net monthly balance

Answer 30

Total inflows - total outflows

Question 31

Calculate closing balance

Answer 31

Opening balance + net monthly balance

Question 32

Formula for the length of working capital cycle

Answer 32

Length of time that goods are held as inventories + time taken for receivables to be paid - period of credit received from suppliers (payables)

Question 33

What two ways can the total contribution of a product be calculated?

Answer 33

Contribution per unit X number of units sold Sales revenue - total variable costs

Question 34

Formula for weekly profit

Answer 34

Total contribution - fixed costs

Question 35

How to calculate total contribution

Answer 35

Contribution per unit X number of units sold

Question 36

Calculation for contribution per unit

Answer 36

Selling price - variable costs

Question 37

Formula for break even output

Answer 37

Fixed costs -------------------------- Contribution per unit

Question 38

Formula for target profit output

Answer 38

Fixed costs + target profit -------------------------- Contribution per unit

Question 39

How do yo calculate Gross profit margin (%)

Answer 39

Gross profit -------------------------- Sales revenue (turnover) X100

Question 40

Formula for operating profit margin (%)

Answer 40

Operations profit -------------------------- Sales revenue (turnover) X100

Question 41

What is the formula for the profit of the year margin (%)

Answer 41

Profit for year -------------------------- Sales revenue (turnover) X100

Question 42

Calculate labour turnover

Answer 42

Number of employees leaving over a given period of time ------------------------------------- Average number employed over a given period X100

Question 43

Calculate retention rates

Answer 43

Number of employees with one or more years service --------------------------------------- Overall workforce numbers X100

Question 44

Formula for labour productivity

Answer 44

Output per period -------------------------- Number of employees per period

Question 45

How is labour costs per unit calculated ?

Answer 45

Total labour costs ----------------------- Total units of output

Question 46

Formula for the employee costs as a percentage of turnover

Answer 46

Employee costs ------------------ Sales turnover X100