Formulas Flashcards
1
Q
Net Multiplier (Formula)
A
Net Multiplier = Net Operating Revenue / Total Direct Labor
Net Multiplier = Break Even Rate / Invert of Target Profit
2
Q
Total Indirect Expenses (Formula)
A
Total Indirect Expenses
= Overhead Rate x Direct Labor
3
Q
Current Ratio
A
Current Ratio =
Current Assets / Current Liabilities
- Long term insight
- good current ratio = anything between1.5 and 3
4
Q
Quick Ratio
A
Quick Ratio =
Cash+Accounts Receivable+Revenue Billed / Total Current Liabilities
- Liquidity- short term insight
- good quick ratio = anything above 1.00
5
Q
Overhead Rate (Formula)
A
Overhead Rate =
Total Indirect Expenses / Direct Labor
6
Q
Utilization Rate (Formula)
A
Utilization Rate = Direct Labor / Total Labor
(Firm)
Utilization Rate = Chargeable Hours Worked / Total Hours (a year)
(Individual)
