Equations Flashcards
Assets =
Liabilities + owner equity
Equity =
Assets - Liabilities
Return on capital percentage =
Income / average total assets
Net profit margin =
Practice profit / Practice revenue
Average transaction charge =
Practice Revenue / practice transactions
Revenue per full-time DVM =
Practice Revenue / # of full-time DVMs
Accounts receivable turnover =
Credit sales (ie charge accounts) / average accounts receivable
Average accounts receivable =
(Beginning AR + ending AR) / 2
Days in accounts receivable =
of days in a period / AR turnover
Profit =
Revenue - Expenses
Cost of a service =
(Fixed costs per minute + staff costs per minute) x length of procedure in staff minutes) +
(DVM costs per minute x length of procedure in DVM minutes) +
(direct costs x 2) +
Desired profit
Cost per client =
(gross revenue / # of clients) x % of cost (ie % of expenses)
Revenue per FTE Vet (DVM specific) =
Average transaction fee x # of invoices per year (DVM specific)
Inventory re-order point =
Average daily use x lead time
Re-order quantity=
Average daily use x turnover goal (in days)
