Calculations Flashcards
Break even
Fixed costs/ selling price per unit - variable cost per unit
Labour turnover
Staff leaving/ staff employed x100
Variance
Budgeted figure- actual figure
AAR (%)
Average annual return/ initial cost x100
Inventory turnover
Cost of sales/ average inventory held
Receivables days
Receivables/ revenue x 365
Breaks down the average time it takes company’s customers to pay their invoices
Payable days
Payables/cost of sales x365
Average time it takes a company to pay its bills
Gearing (%)
Non current liabilities/total equity+non current liabilities x100
How much a company is funded by debt
High gearing 50% plus
ROCE
operating profit/ total equity + non current liabilities(CE) x100
Analyses how well a company puts it capital to use
Re order level
Average demand x lead time
Labour productivity
Output per employee
Payback period
Initial outlay of investment/ cash flow
ROI
Revenue / cost of investment
Current ratio
Current assets/ current liabilities
Ability for a firm to pay its short term obligations due within one year
Market capitalisation
Number of shares issued x share price
Variable costs
Variable cost per unit x units sold
Gross profit margin
Gross profit / revenue x 100
Operating profit margin
Operating profit / revenue x100
Contribution per unit
Selling price - variable cost per unit
Labour cost per unit
Labour costs / units of output
Capital employed
Total equity + non current liabilities
Or
Total assets - current liabilities
AAR extended formula
1) find out total return
2) take away total return from IC
3) divide it by years
4) use that number to divide by initial cost and x100
Acid test
(Current assets - inventory)/ current liabilities
Profit
Contribution minus fixed costs
