Equatiom

Question 1

Revenue/ sales/turnover

Answer 1

Selling price per unit× number of units sold

Question 2

Variable costs (total variable costs)

Answer 2

Variable cost per unit × number of units sold

Question 3

Total costs

Answer 3

Fixed plus variable coste

Question 4

Total costs

Answer 4

Fixed costs plus variable costs

Question 5

Market capitalisation of a business

Answer 5

Number of issued shares × current share price

Question 6

Expected value of a decision with two possible outcomes e.g A and B

Answer 6

(Pay off of A × probability of A)+( pay off of B × probability of B)

Question 7

Net gain

Answer 7

Expected value- initial cost of decision

Question 8

Market growth

Answer 8

Change in size of market over a period/ original size of market × 100

Question 9

Market share

Answer 9

Sales of one product/ brand / business
Divided by total sales in market ×100

Question 10

Added value

Answer 10

Sales revenue-costs of bought in goods and services

Question 11

Labour productivity

Answer 11

Output over a time period/number of employees

Question 12

Unit costs

Answer 12

Total costs/ number of units of output

Question 13

Capacity utilisation

Answer 13

Actual output/maximum possible output

Question 14

Return of investment

Answer 14

Profit from the investment/cost of the investment ×100

Question 15

Grodd profit

Answer 15

Revenue- cost of sales

Question 16

Profit from operations/operating profit

Answer 16

Gross profit- operating expenses

Question 17

Profit for year

Answer 17

Operating profit + profit from other activities- networks finance costs - tax

Question 18

Gross profit margin

Answer 18

Gross profit/revenue × 100

Question 19

Profit from operations margin

Answer 19

Operating profit/ revenue × 100

Question 20

Profit for year margin

Answer 20

Profit of year/ revenue × 100

Question 21

Variance

Answer 21

Budgeted figure-actual figure

Question 22

Contribution per unit

Answer 22

Selling price- variable costs per unit
+ contribution per unit × units sold
Or
Total revenue - total variable costs

Question 23

Total contribution

Answer 23

Contribution per unit× Units sold
Or
Total revenue- Total variable costs

Question 24

Break even output

Answer 24

Fixed costs/ contribution per unit
+
Actual level of output - break even level of output

Question 25

Margin of safety

Answer 25

Actual level of output- break even level of output

Question 26

Labout turnover

Answer 26

Number of staff leaving/number of staff employed by the business ×100

Question 27

Employee retention rate for particular time of period

Answer 27

Number of employees who remained with the business for the whole period of time/ number of employees at start of the time period × 100

Question 28

Employees costs as a percentage of turnover

Answer 28

Employee costs/turnover ×100

Question 29

Labour cost per unit

Answer 29

Labour costs/units of output

Question 30

Return in capital employed

Answer 30

Operating orofit/ total equity + non current liabilities × 100
Where total equity + non current liabilities = capital employed

Question 31

Current ratio

Answer 31

Current assets/ current liabilities

Question 32

Gearing

Answer 32

Non current liabilities/total equity+ non current liabilities × 100
Where total equity + non current liabilities = capital employed

Question 33

Payable days

Answer 33

Receivables/ revenue × 365

Question 34

Receivables days

Answer 34

Receivables / revenue × 365

Question 35

Inventory turnover

Answer 35

Cost of sales / average inventories held

Question 36

Average of return

Answer 36

Average annual return /
Initial cost of project × 100