Formulae Flashcards
Revenue formulae
Selling price per unit X number of units sold
Variable cost per unit X number of units sold
Variable costs
Total costs
Fixed costs + variable costs
Profit
Total revenue - total costs
Market capitalisation of a business
Number of issue shared x current share price
A & B = (pay off of A x probability of a) + (pay off of b x probability of b)
Expected value of a decision with two possible outcomes
Expected value - initial cost of decision
Net gain
Change in the size of the market over a period / original size of the market = x 100
Market growth
Market share
Sales of one product or brand or business / total sales in the market = x 100
Added value
Sales revenue - costs of bought in goods and services
Output over a period of time / number of employees
Labour productivity
Unit costs (average costs)
Total costs / number of units of output
Capacity utilisation
Actual output / maximum possible output = x 100
Return on investment
Profit from the investment / cost of the investment = x 100
Gross profit
Revenue - costs of sales
Profit from operations
Operating profit = gross profit - operating expenses
Profit of the year
Operating profit + profit from other activities - net finance costs - tax
Gross profit / revenue = x 100
Gross profit margin
Profit from operations margin
Operating profit / revenue = x 100
Profit for year margin
Profit for year / revenue = x 100
Variance
Budgeted figure - actual figure
Contribution per unit
Selling price - variable costs per unit
Contribution per unit x units sold
Total contribution
Break even output
Fixed costs / contribution per unit
