Business Equations Flashcards
Revenue
Revenue = Price * Quantity sold
Total costs
Total costs = All variable costs + All fixed costs
Profit
Profit = Sales Revenue - Total costs
Interest rate
Interest rate = Interest Paid/ amount borrowed * 100
Break-even quantity
Break-even quantity = Fixed costs / (Selling price - Variable Costs per unit )
Margin of Safety
Margin of safety = Level of output - Break-even point
Net cash flow
Net cash flow = Cash inflow - Cash outflow
Closing Balance
Closing Balance = Opening balance + Net cash flow
Productivity
Productivity = Output / input
Gross profit
Gross profit = Sales revenue - Costs of goods sold
Net profit
Net profit = Gross profit -Expenses
Net profit margin
Net profit margin = Net profit/sales revenue * 100
Gross profit margin
Gross profit margin = Gross profit/sales revenue * 100
Net profit margin
Net profit margin = Net profit / Sales Revenue
Average rate of return
Average rate of return = (Total profit/number of years)/ Cost of investment * 100
