Equations

Question 1

How do you work out Net Cash Flow?

Answer 1

Cash Inflows-Cash Outflows

Question 2

How do you work out Closing Balance?

Answer 2

Net Cash Flow + Opening Balance

Question 3

What’s the equation for Revenue?

Answer 3

Revenue=Price x Quantity

Question 4

What’s the equation for Total Costs?

Answer 4

Total Costs= Fixed Costs + Variable Costs

Question 5

What’s the equation for Profit?

Answer 5

Profit= Revenue- Total Costs

Question 6

What’s the equation for Sales Volume?

Answer 6

Sales Volume= Sales Revenue/ Sales Price

Question 7

What’s the equation for Total Variable Cost?

Answer 7

Total Variable Cost= Variable Cost x Quantity

Question 8

What’s the equation for Breakeven?

Answer 8

Breakeven= Fixed costs / Selling price-Variable Cost per unit

Question 9

What’s the equation for Total Contribution?

Answer 9

Total Contribution= Contribution per unit x Quantity

Question 10

What’s the equation for Margin of Safety?

Answer 10

Actual sales- Break even point

Question 11

What’s the equation for a Budget Variance?

Answer 11

Actual Spend- Budget Spend (Spend is interchangeable for Revenue etc..)

Question 12

What’s the equation for Gross Profit?

Answer 12

Revenue-Cost of goods sold

Question 13

What’s the equation for Operating Profit?

Answer 13

Revenue-Operating costs

Question 14

What’s the equation for Net Profit (Profit for the year)

Answer 14

Operating Profit- Tax and Dividends

Question 15

What’s the equation for Gross Profit Margin?

Answer 15

(Gross Profit/ Revenue)x100

Question 16

What’s the equation for Operating Profit Margin?

Answer 16

(Operating Profit/Revenue)x100

Question 17

What’s the equation for Net Profit Margin?

Answer 17

(Net Profit/Revenue)x100

Question 18

What is the equation for Labour Productivity?

Answer 18

Total Units of Output/ Number of Employees

Question 19

What is the equation for Capital Productivity?

Answer 19

Total Units of Output/ Number of Machines

Question 20

What’s the formula for Capacity Utalization?

Answer 20

(Current Output/Maximum Possible Output)x100

Question 21

What is the equation for Current Ratio?

Answer 21

Current Assets/Current Liabilities (Divide)

Question 22

What is the equation for the Acid Test Ratio?

Answer 22

(Current Assets-Inventory)/ Current Liabilities

Question 23

What is the Net Assets equation?

Answer 23

Total Assets-Total Liabilities

Question 24

What’s the equation for Labour Productivity?

Answer 24

Labour Productivity=Total units of output/ Number of employees (Divide)

Question 25

What’s the equation for Profit Margin?

Answer 25

Profit Margin=(profit/Revenue) x100

Question 26

What’s the equation for Capacity Utilization?

Answer 26

Capacity Utilization= (Current Output/ Maximum Possible Output) x100

Question 27

What’s the equation for Market Share?

Answer 27

Total Company Sales / Total Industry Sales