Formulas 1 Flashcards
Annual Percentage Return (APR)
Effective Interest Rate * # of periods in year
Asset Turnover
Sales / Total Assets
Breakeven Point - Units
Fixed Costs / Contribution Margin
Breakeven Point - Dollars
Fixed Costs / Contribution Margin Ratio
Current Ratio
Current Assets / Current Liabilities
Contribution Margin
Revenue - Variable Costs
or
Sales - Variable Costs
Cost of Goods Sold
Beg. Inv + Inv Purchases - End Inv
Dividend Payout Ratio
cash dividend per share / earnings per share
Effective Interest Rate
(principleratetime) / principle
Gross Margin
Revenue - CGS (or gross profit)
Inventory Conversion Period
Average Inventory / Cost of sales per day
Avg Inv = (Beg Inv + End Inv) / 2
*Make sure to use 365 days per year unless stated otherwise.
Inventory Turnover
CGS / Average Inv
Marginal Propensity to Consume
Change in Spending / Change in disposable Income
Marginal Propensity to Save
Change in Savings / Change in Income
Number of Days Sales in Inventory
Days in year (360 or 365) / Inventory Turnover
Quick Ratio
Quick Assets / Current Liabilities
*Quick Assets = cash, mkt securities, A/R
Residual Income (RI)
Operating Profit - Interest on Investment (or required rate of return)
Required Return
NBV (equity) * hurdle rate
Times Interest Earned Ratio
EBIT / interest expense
Total Costs
FC + VC
or
y = mx + b, where x = variable, m = slope, b = y intercept
Work in Process (WIP)
DM used + DL + Manufacturing OH
Average Accounts Receivable
(Beg AR + End AR) / 2
