Formulas

Question 1

Market Share

Answer 1

Firms sales in time period / total market sales in time period x 100

Question 2

Price Elasticity of demand

Answer 2

Percentage change in quantity demanded/Percentage change in price x100

Question 3

Net cash flow

Answer 3

cash inflow (receipts) – cash outflow (payments)

Question 4

Working Capital

Answer 4

current assets – current liabilities

Question 5

Break-even Point

Answer 5

fixed cost / contribution per unit = Break-even units

Question 6

Break-even Sales

Answer 6

break-even units x selling price per unit

Question 7

Margin of Safety

Answer 7

Total sales – break-even sales

Question 8

Total Cost

Answer 8

fixed cost + variable cost

Question 9

Capacity Utilisation

Answer 9

Actual output / Productive capacity x 100

Question 10

Gross Profit

Answer 10

sales revenue – cost of goods sold

Question 11

Cost of goods sold

Answer 11

opening stock + purchases – closing stock

Question 12

Retained Profit

Answer 12

NP after interest – tax – dividends

Question 13

Gross Profit Margin Ratio

Answer 13

GP /Sales revenue x 100

Question 14

Net profit margin ratio

Answer 14

NP/Sales Revenue x 100

Question 15

Current Ratio

Answer 15

current asset /current liabilities

Question 16

Acid Test Ratio

Answer 16

(current asset – stock) /current liabilities

Question 17

Contribution per unit

Answer 17

Fixed cost/selling price per unit - variable cost per unit