formulas

Question 1

total costs

Answer 1

fixed costs + variable costs

Question 2

profit

Answer 2

total revenue - total costs

Question 3

variable costs

Answer 3

vc per unit x no of units sold

Question 4

total revenue (sales revenue/turnover)

Answer 4

selling price per unit x no of units sold

Question 5

market capitalisation

Answer 5

number of issued shares x current share price

Question 6

net gain

Answer 6

expected value - initial cost of decision

Question 7

market growth in year x

Answer 7

change in size of market between year x and y / size of market in year x (x 100)

Question 8

sales growth in year x

Answer 8

change in sales of product or business between year x and y / sales of product in year x (x100)

Question 9

market share

Answer 9

sales of one product / total sales in market x 100

Question 10

price elasticity of demand

Answer 10

percent change in quantity demand /
percentage change price

Question 11

added value

Answer 11

sales revenue - costs of bought in goods and services

Question 12

labour productivity

Answer 12

output per time period / no of employees

Question 13

unit costs ( average costs)

Answer 13

total costs of production / no of units of output produced

Question 14

capacity utilisation

Answer 14

actual output in a given time period / max possible output in a time period x 100

Question 15

return on investment

Answer 15

return on investment / cost of investment x 100

Question 16

gross profit

Answer 16

sales revenue - cost of sales

Question 17

profit from operations

Answer 17

sales rev - cost off sales - operating expenses

Question 18

profit for year

Answer 18

operating profit + profit from other activities - net finance costs - tax

Question 19

contribution per unit

Answer 19

selling price - vc per unit

Question 20

total contribution

Answer 20

contribution per unit x units produced or sold

Question 21

break - even output

Answer 21

fixed costs / contribution per unit

Question 22

margin of safety

Answer 22

actual level of output - breakeven level of output

Question 23

gross profit margin

Answer 23

gross profit / sales revenue x 100

Question 24

profit from operations margin

Answer 24

operating profit / sales rev x 100

Question 25

profit for the year margin

Answer 25

profit for year / sales rev x 100

Question 26

labour turnover

Answer 26

no of staff leaving during year / average no of staff employed by the business during the year x 100

Question 27

employee retention rate for a particular time period

Answer 27

no of employees at end of period - number of leavers / no of employees at end of period x 100

Question 28

employee costs as percentage of turnover

Answer 28

employee costs / sales turnover x 100

Question 29

labour cost per unit

Answer 29

labour costs / units of output

Question 30

ROCE

Answer 30

operating profit / total equity + non-current liabilities x 100

Question 31

current ratio

Answer 31

current assets / current liabilities

Question 32

gearing

Answer 32

non - current liabilites / total equity + non current liabilites x 100

Question 33

payables days

Answer 33

payables / cost of sales x 365

Question 34

receivables days

Answer 34

receivables / sales revenue x 365

Question 35

inventory turnover

Answer 35

cost of goods sold / averages inventories held

Question 36

average rate of return

Answer 36

bet retune from project / initial cost of project x 100