Equations

Question 1

Profit

Answer 1

Profit = Total revenue - Total costs
Profit = Contribution - Fixed costs

Question 2

Break Even output

Answer 2

Break even output = fixed coasts / contribution per unit

Question 3

Contribution per unit

Answer 3

Contribution per unit = selling price - variable costs

Question 4

Total contribution

Answer 4

Total contribution = contribution per unit x quantity sold

Question 5

Operating profit margin

Answer 5

Operating profit margin = (operating profit/revenue) x 100

Question 6

Margin of safety

Answer 6

Margin of safety = actual output - break even output

Question 7

Capital intensity

Answer 7

Capital intensity = (capital goods / fixed costs) x 100

Question 8

Average cost per unit

Answer 8

Average cost = Total production costs / Total output
per unit

Question 9

Budget variance

Answer 9

Budget Variance = budget amount - actual amount

Question 10

Labour productivity

Answer 10

Labour productivity = output / num of employees

Question 11

Labour turnover

Answer 11

Labour turnover = (num of employees / total num of employees) x 100

Question 12

Capacity utilisation

Answer 12

Capacity utilisation = ( actual output / maximum possible output) x 100

Question 13

Gross profit

Answer 13

Gross profit = sales revenue - cost of sales

Question 14

Gross profit margin

Answer 14

Gross profit = (gross profit / revenue) x 100
margin

Question 15

Operating (net) profit

Answer 15

Operating = (gross profit) - (fixed cost + variable costs)
(Net) profit

Question 16

Net capital employed

Answer 16

Net capital = non current liabilities - equity
Employed

Question 17

Total variable costs

Answer 17

Total variable = num of units sold x variable costs per unit
Costs

Question 18

Market share

Answer 18

Market = sale of firm / total sale of market
Share

Question 19

% change

Answer 19

% change = (different / original) x 100

Question 20

Total added value

Answer 20

Total added = sales revenue - costs of ????
Value

Question 21

Net cash flow

Answer 21

Net cash = cash inflow - cash outflows
Flow

Question 22

Sales revenue

Answer 22

Sales revenue = selling price x quantity sold

Question 23

Market size

Answer 23

Market share = num of unit sold x selling price
Market share = revenue / market share

Question 24

PED

Answer 24

PED = (% change in quantity demanded / % change in price)

Question 25

YED

Answer 25

YED = (% change in quantity demanded / % change in income)

Question 26

Market growth

Answer 26

Market growth = ( new market size - old market size) / old market x 100

Question 27

Acid ratio test

Answer 27

Acid ratio = (current assets - stock) / current liabilities
Test

Question 28

Current ratio

Answer 28

Current ratio = current assets / current liabilities

Question 29

Return of capital employed

Answer 29

ROCE = (operating profit / capital employed) x 100

Question 30

Gearing ratio

Answer 30

Gearing ratio = non current liabilities / (total equity + non current liabilities) x 100