Formulas

Question 1

Revenue

Answer 1

Selling price per unit x number of units sold

Question 2

Variable costs

Answer 2

Variable cost per unit x number of units sold

Question 3

Total costs

Answer 3

FC + VC

Question 4

Profit

Answer 4

Total revenue - total costs

Question 5

Market capitalisation

Answer 5

Current share price x number of shares issued

Question 6

Expected value of decision with 2 possible outcomes

Answer 6

(Outcome A x probability A) + (outcome B x probability B)

Question 7

Net gain

Answer 7

EV - initial costs

Question 8

Market growth %

Answer 8

Change in market size/original market size x 100

Question 9

Market share %

Answer 9

Sales of one business or product / total market sales x 100

Question 10

Added value

Answer 10

Sales revenue - cost of bought in goods or services

Question 11

Labour productivity

Answer 11

Output / number of employees

Question 12

Unit costs

Answer 12

Total costs / units of output

Question 13

Capacity utilisation %

Answer 13

Actual output / max possible output x 100

Question 14

Return on investment %

Answer 14

Profit from investment / cost of investment x 100

Question 15

Gross profit

Answer 15

Revenue - cost of sales

Question 16

Operating profit

Answer 16

Gross profit - operating expenses

Question 17

Profit for the year

Answer 17

Operating profit + other profit - costs - tax

Question 18

Variance

Answer 18

Budgeted figure - actual figure

Question 19

Contribution per unit

Answer 19

SP - VC

Question 20

Total Contribution

Answer 20

Contribution per unit x number of units sold

Question 21

Break even output

Answer 21

Fixed costs / contribution per unit

Question 22

Margin of safety

Answer 22

Actual output - break even output

Question 23

Labour turnover %

Answer 23

Number of staff leaving / number of staff employed x 100

Question 24

Labour retention rate %

Answer 24

Number of employees still at the business / number employed at start x 100

Question 25

Employee costs as percentage of turnover

Answer 25

Employee costs / turnover x 100

Question 26

Labour costs per unit

Answer 26

Labour costs / units of output