Business

Question 1

What is the formula for variable costs ?

Answer 1

Variable costs= Variable cost per unit x N.O. Units sold

Question 2

What is the formula for Market capitalisation?

Answer 2

Market capitalisation of a business = N.O. Issues shared x current share price

Question 3

Added value formula is what

Answer 3

Added value= sales revenue - cost of bought in goods and services

Question 4

What is the formula for labour productivity ?

Answer 4

Labour productivity = output per time period/ N.O. Employees

Question 5

Unit costs formula ?

Answer 5

Total costs of production/ N.O. Units of output produced

Question 6

Capacity utilisation formula is?

Answer 6

Actual output in a given time period/ maximum possible output in a given time period x 100

Question 7

What is the formula for ROI

Answer 7

ROI/COI x 100

Question 8

What is the formula for gross profit ?

Answer 8

Gross profit = sales rev- Variable costs per unit

Question 9

What is the formula for profit from operations

Answer 9

Profit from operations = sales revenue - Cost of sales -operating expenses

Question 10

What is the formula for profit for year?

Answer 10

Profit for year = operating profit + profits from other activities - Net finance costs - Tax

Question 11

What is the Formula for variance ?

Answer 11

Variance = the difference between an actual and a budged figure. Favourable variance results in profit being higher than forecast. Adverse variance results in profits being lower than forecast.

Question 12

What is contribution per unit?

Answer 12

Contribution per unit = selling price - variable costs per unit

Question 13

What is the formula for total contribution?

Answer 13

Total contribution = contribution per unit x units produced or sold OR TOTAL CONTRIBUTION = TR - Total variable costs

Question 14

What is the formula for the break-even output?

Answer 14

Break- even output= fixed costs/ contribution per unit

Question 15

What is the margin of safety formula?

Answer 15

Margin of safety = actual level of output - break even level of output

Question 16

What is the formula for gross profit margin?

Answer 16

Gross profit = gross profit/ sales revenue x100

Question 17

What is the formula for profit from operations margin ?

Answer 17

Operating profit margin = operating profit/ sales revenue x 100

Question 18

What is the formula for profit for year margin ?

Answer 18

profit for year margin = profit for year/ sales revenue x 100

Question 19

What is the formula for labour turnover ?

Answer 19

Labour turnover = N.O. Staff leaving / Average N.O. Staff x 100

Question 20

What is the for labour retention?

Answer 20

Labour retention = N.O. Staff Employed at end of period - N.O leavers/ N.O. Of staff employed at end of period x 100

Question 21

Formula for employee costs as percentage of turnover?

Answer 21

Employee costs as percentage of turnover = Employee costs/ sales turnover x 100

Question 22

What is the formula for labour costs per unit?

Answer 22

Labour cost per unit = Labour costs/ Units of output

Question 23

What is the formula for ROCE

Answer 23

ROCE = operating profit/ Total equity + non-current liabilities

Question 24

What is the formula for Gearing ?

Answer 24

Gearing= non-current liabilities/ total equity + non current liabilities

Question 25

What is the formula for Inventory turnover?

Answer 25

Inventory turnover = cost of goods sold/ Average inventories held

Question 26

What is the formula for Average rate of return

Answer 26

Average rate of return= Net return from project or N.O. Years/ initial cost of project X 100