Formulas

Question 1

Net cash flow

Answer 1

Cash inflows - Cash outflows

Question 2

Opening balance

Answer 2

Same as previous closing balance

Question 3

Closing balance

Answer 3

Net cash flow + opening balance

Question 4

Sales revenue

Answer 4

Quantity x selling price

Question 5

Sales volume

Answer 5

Revenue / selling price

Question 6

Total costs

Answer 6

Fixed + variable costs

Question 7

Contribution per unit

Answer 7

Average selling price - variable costs per units

Question 8

Break-even output

Answer 8

Fixed costs / contribution per unit

Question 9

Total contribution

Answer 9

Contribution x output

Question 10

Variance %

Answer 10

Variance £ / Forecast £

Question 11

Gross profit

Answer 11

Revenue - cost of sale (variable costs)

Question 12

Operating profit

Answer 12

Gross profit - overheads (fixed costs)

Question 13

Net profit

Answer 13

Operating profit - corporation tax

Question 14

Current ratio

Answer 14

Current assets / current liabilites

Question 15

Acid test ratio

Answer 15

Current assets - inventories / current liabilities

Question 16

Capacity utilisation

Answer 16

(Current output / maximum output) x 100

Question 17

Gearing ratio

Answer 17

(Non-current liabilities/capital employed) x 100

Question 18

ROCE

Answer 18

(operating profit/capital employed) x 100

Question 19

Capital employed

Answer 19

Total equity + non-current liabilities

Question 20

ARR

Answer 20

(Annual average profit/initial cost) X 100

Question 21

NPV

Answer 21

ARR X discounted factor

Question 22

Number of months needed to pay back in simple payback

Answer 22

(The remaining cost left to be repaid divided by the profit made that year) x 12

Question 23

4 year moving average

Answer 23

Add the year before and year. Then do the same for the next 4 year moving average. Add both numbers up and divide by 8

Question 24

3 year moving average

Answer 24

Add the year before and year after and divide by three 3

Question 25

Float time in a CPA

Answer 25

LFT - EST

Question 26

Margin of safety

Answer 26

Actual output - break even output

Question 27

Variance

Answer 27

Actual figure - budgeted figure

Question 28

Labour productivity?

Answer 28

Output per period/number of employees

Question 29

Labour retention?

Answer 29

((Number of staff at the beginning - number of staff at the end) / number of staff employed at staff) x 100

Question 30

Labour turnover

Answer 30

(Number of staff leaving/ average number of staff employed at the start) x 100

Question 31

Average number of staff employed at the start

Answer 31

Number of staff employed at start + at the end / 2

Question 32

What is absenteeism?

Answer 32

(number of days staff are absent in a time period / number of staff employed) x 100

Question 33

Re-order quantity?

Answer 33

Maximum stock level - minimum stock level

Question 34

Inventory turnover?

Answer 34

(Average inventory / cost of sales) x 365