Financial Management Flashcards
1
Q
Margin of Safety (%) =
A
(Expected Sales - Breakeven Sales)/Expected Sales
2
Q
Gross Profit Margin =
A
(Gross Profit/Sales) x 100
3
Q
Net Profit Margin =
A
(Net Profit Before Interest and Tax/Sales) x 100
4
Q
Average Stock Turnover Period =
A
(Average Stock Held/Cost of Sales) x 365
5
Q
Average Settlement Period for Debtors =
A
(Trade Debtors/Credit Sales) x 365
6
Q
Average Settlement Period for Creditors =
A
(Trade Creditors/Credit Purchases) x 365
7
Q
Current Ratio =
A
Current Assets/Current Liabilities
8
Q
Gearing Ratio =
A
Long Term Liabilities/(Share Capital+Long Term Liabilities)
9
Q
Variances Formulas
A
All (Actual - Flexed Budget) except Sales Volume Variance (which is original profit - flexed profit)
