Formulae Year 1

Question 1

Profit formula?

Answer 1

TR-TC

Question 2

Profit using break even

Answer 2

Total contribution - fixed costs

Question 3

Revenue formula?

Answer 3

Price x Quantity demanded

Question 4

Total Variable Cost?

Answer 4

Unit cost x Quantity demanded

Question 5

Total Cost?

Answer 5

Fixed Cost + Total Variable Costs

Question 6

Break even

Answer 6

Fixed Cost divided by Contribution

Question 7

Contribution

Answer 7

Selling Price - Variable Costs

Question 8

Market Capitalisation

Answer 8

Share price x number of shares

Question 9

Expected Value (decision trees)

Answer 9

Probability x outcome

Question 10

Net Gain

Answer 10

Expected Value - Cost of decision

Question 11

Market Share

Answer 11

Company sales/ total market sales x 100

Question 12

Market Growth

Answer 12

Difference between years/original sales x 100

Question 13

% growth/decline

Answer 13

difference / original x 100

Question 14

Labour productivity?

Answer 14

output per period (units)/number of employees

Question 15

Capacity utilisation?

Answer 15

Actual level of output / Max possible output x 100

Question 16

Gross profit?

Answer 16

Revenue (sales) - Cost of Sales

Question 17

Cost of Sales

Answer 17

Opening Stock + Stock purchases - Closing stock

Question 18

Operating profit?

Answer 18

Gross profit - operating costs (ie running costs like wages)

Question 19

Profit for the year (net profit)?

Answer 19

Operating profit - interest - tax (ie finance costs)

Question 20

Budget variance?

Answer 20

Budget - Actual

Question 21

Net Cash Flow

Answer 21

Cash in - cash out

Question 22

Margin of Safety?

Answer 22

Expected sales - break even

Question 23

Total Contribution?

Answer 23

Contribution per unit x number of units sold

Question 24

Net profit margin?

Answer 24

Net profit / revenue (or sales ) x 100

Question 25

Gross Profit margin?

Answer 25

Gross Profit / revenue (or sales) x100

Question 26

ROCE (return on capital employed)?

Answer 26

Operating profit / Capital employed x 100

Question 27

Labour turnover?

Answer 27

Number of employees leaving/ total number of employees x 100

Question 28

Labour productivity?

Answer 28

Output per period/number of employees

Question 29

Labour retention?

Answer 29

Number of employees - number leaving / number of employees x 100

Question 30

Labour cost per unit?

Answer 30

labour cost / units produced

Question 31

Employee cost as % of turnover?

Answer 31

Total employee cost/total turnover (sales) x 100