formulae Flashcards
revenue
selling price x no. units sold
variable costs
variable cost per unit x no. units sold
total costs
fixed costs + variable costs
profit
revenue - total costs
OR
total contribution - fixed costs
market capitalisation of a business
no. issued shares x current share price
expected value of decision with two possible outcomes
(pay off of A x probability of A)+(pay off for B x probability of B)
net gain
expected value - initial cost of decision
market growth
(change in size of market over a period/ original size of market) x 100
market share
(sales of one product to brand or business / total sales in the market|) x 100
added value
sales revenue - costs of brought in goods and services
labour productivity
output over a time period / no. of employees
unit costs
total costs / no. units output
capacity utilisation
actual output / maximum possible output
return on investment
(profit from investment/ cost of investment) x 100
gross profit
revenue - cost of sales
profit from operation
gross profit - operating expenses
profit for the year
(operating profit + profit from other activities) - (net finance costs + tax)
gross profit margin
(gross profit/ revenue) x 100
operating profit margin
(operating profit/ revenue) x 100
profit for the year margin
(profit for year / revenue) x 100
variance
budgeted figure - actual figure
contribution per unit
selling price - variable costs
total contribution
contribution per unit x units sold
OR
total revenue - total variable costs
break-even output
fixed costs / contribution per unit
margin of safety
actual level of output - breakeven output
labour turnover
(no. staff leaving / no. staff employed by business) x 100
employee retention rate
(no. employees who remained with business for whole period of time / no employees at start of the time period) x 100
employee costs as a percentage of turnover
(employee costs/ turnover) x 100
labour costs per unit
labour costs / units of output
return on capital employed
(operating profit/total equity + non-current liabilities) x 100
current ratio
current assets / current liabilities
gearing
(non-current liabilities / total equity + non- current liabilities) x 100
payable days
(payables / cost of sales) x 365
receivable days
(receivables/ revenue) x 365
inventory turnover
cost of sales / average inventories held
average rate of return
(average annual return / initial cost of project) x 100
