calculation formulas

Question 1

variable costs ( change with output )

Answer 1

output x variable cost per unit

Question 2

total costs

Answer 2

variable costs + fixed costs

Question 3

revenue

Answer 3

selling price x quantity sold

Question 4

unit costs

Answer 4

total costs/number of units

Question 5

profit

Answer 5

revenue - total costs ( OR contribution - total costs )

Question 6

market capitalisation

Answer 6

current share price x number of shares sold

Question 7

expected value

Answer 7

Probability x outcome

Question 8

net gain

Answer 8

expected value - cost of decision

Question 9

sales volume

Answer 9

number of items sold

Question 10

sales value

Answer 10

volume x selling price

Question 11

market growth

Answer 11

(% change in the market size) = market size in year - market size previous year/original market size x 100

Question 12

sales growth

Answer 12

Change in market sales over a period of time/ original market sales x 100

Question 13

market share

Answer 13

sales of one product/total sales in market x 100

Question 14

price elasticity of demand (PED)

Answer 14

% change in quantity demanded/% change in price

Question 15

Income elasticity of demand (YED)

Answer 15

% change in quantity demanded/% change in price

Question 16

unit costs

Answer 16

total costs/total outputs

Question 17

labour productivity

Answer 17

output per period/number of employees per period

Question 18

labour productivity

Answer 18

output per period/number of employees per period

Question 19

capacity

Answer 19

maximum level of production

Question 20

capacity utilisation

Answer 20

actual output/maximum possible output x 100

Question 21

variance

Answer 21

actual - budget

Question 22

contribution

Answer 22

selling price per unit - variable cost per unit

Question 23

total contribution

Answer 23

contribution per unit x number of units sold

Question 24

break even

Answer 24

fixed costs/contribution per unit

Question 25

margin of safety

Answer 25

actual output - breakeven output

Question 26

gross profit

Answer 26

sales revenue - cost of sales

Question 27

gross profit margin

Answer 27

gross profit/sales revenue x 100

Question 28

operating profit

Answer 28

gross profit - expenses

Question 29

operating profit margin

Answer 29

operating profit/sales revenue x 100

Question 30

profit for the year margin

Answer 30

profit for the year/sales revenue x 100

Question 31

ROI

Answer 31

operating profit/capital employed x 100

Question 32

net cash flow

Answer 32

total inflows - total outflows

Question 33

closing balance

Answer 33

opening balance/net cash flow

Question 34

employee costs as a % of turnover

Answer 34

employee costs/sales revenue x 100

Question 35

labour turnover

Answer 35

number of employees leaving in period/average number employed in period x 100

Question 35

labour costs per unit

Answer 35

total labour costs/total units of output x 100

Question 36

retention rate

Answer 36

number of employees with 1 or more years of service/overall employee numbers x 100