FORMULA Flashcards
1
Q
Overhead Absorption Rate
A
Total overhead cost / total direct labour hours
2
Q
Return on Investment (ROI)
A
(Net income/total investment) x100
3
Q
Contribution Margin
A
Sales revenue - Variable costs
4
Q
Contribution Margin Per Unit
A
Sales price per unit - variable cost per unit
5
Q
Break Even Point (in units)
A
Total fixed costs / contribution margin per unit
6
Q
Contribution Margin Ratio
A
(Contribution Margin/Sales) X 100
7
Q
Margin of Safety
A
The amount by which sales may decrease before a loss occurs
Current sales - Breakeven point / Current sales.
