business formulas Flashcards
Labor Turnover
(employees who leave/total employees) x 100
Total Costs
TC = TFC + TVC
Total Revenue
TR = Quantity x Price
Cost of Sales
Opening stock + purchases - closing stock
Net Assets
(non-current assets + current assets) - (non-current liabilities + current liabilities)
Straight line Method of Depreciation
(cost of asset - residual value) / Working life in years
Units of Depreciation Method
(number of units produced / life in number of units) x (initial cost - residual value)
Payback period
Cost of the investment / Contribution per month or year
Variances
Budget amount - Budget actually spent
Market Share
(sales of a business or product/total market sales) x 100
Break-even quantity
fixed costs / contribution per unit
Market Growth
(this years market sales - last year market sales) / (years market sales) x 100
Contribution per unit
Price - Average Variable cost
Total Contribution
(Prive - AVC) x Quantity sold
Margin of Safety
(Current level of sales - break even output) / current level of sales ) x 100
Target Profit
Estimated Total Revenue - Estimated Total Costs
Target Profit Quantity
(Fixed Costs + Target Profit) / (Price - AVC)
Target Price
Average Fixed Costs + AVC
Defect Rate
Defective output / total output
Capital Productivity Rate
(Total Output / Total Fixed Assets) x 100
Labor Productivity Rate
(Total Output / Total Employees) x 100
Operating Leverage
(Quantity Contribution) / Quantity x (Contribution - Fixed costs)
