formulas Flashcards
Total Costs
Fixed costs + Vairable costs
Profit
Total revenue - Total costs
Variable costs
Variable cost per unit X Units sold
Sales revenue/ Turnover
Selling price per unit X no. of units sold
Market Capitalisation
No. of issued shares X Current share price
Expected value of a decision with two possible outcomes (A +B)
(Pay off of A X Probability of A)+(Pay off of B X Probability of B)
Decision tree Net Gain
Expected value- Initial cost of decision
Market size (volume)
The quantity of goods and services produced in a particular market over a period of time (one year)
Market size (value)
The total sales revenue generated from selling all of the goods and services produced in a particular market over a period of time (1year)
Sales Volume
The quantity of goods and services produced by a particular business over a period of time.
Sales Value
Total sales revenue of a particular business over a period of time.
Market growth in a year (%)
Change in the size of the market between year (x-1) and year x / Size of the market in a year X100
Sales growth (%) in year X
change in sales of product or business between year (x-1) and year x / Sales of product or bussiness in year (x-1) X100
Market share (%)
sales of one product or brand or business / Total sales in the market
Added value
Sales revenue- cost of goods and services bought in
Labour productiviy
Output per time period / No of employees
Unit costs (average costs)
Total costs of production / No. of units of output produced
Capacity Utilisation (%)
Actual output in a given time period / Maximum possible output X100
Return on investment (%)
Return on investment X Cost of investment X100
Gross Profit
Sales Revenue - Cost of sales
Operations Profit
Sales revenue - cost of sales- Operating Expenses
Year Profit
Operating profit + Profit from other activities - Net finance costs - Tax
Variance
The difference between an actual and a budgeted figure. It can be favourable or adverse.
Contribution per unit
Selling price- Variable costs per unit
Total Contribution
Contribution x Units produced/ sold OR Total revenue- Total variable costs.
Break even output
Fixed Costs / Contribution per unit
Margin of Safety
Actual level of output - Breakeven level of output
Gross profit margin (%)
Gross profit/ Sales revenue x100
Profit from Operations Margin (%)
Operating Profit/ Sales revenue X100
Profit for year margin
Profit for year/ Sales revenue
Labour Turnover (%)
No. of staff leaving during the year/ Average no. of staff employed in that year
Employee Retention (%)
No. of employees - No. of leavers / No. of employees at end of period
Employee costs as a percentage of turnover
Employee costs/ Sales turnover X100
Labour cost per unit
Labour costs/ Units of output
ROCE (%)
Operating profit/ Capital employed
Capital Employed
Total equity + Non current liabilities
Current ratio
Current assets / Current liabilities
Gearing (%)
Non current liabilities/ Capital employed
Average rate of return (%)
Net return from project or no. of years/ Initial cost of project X100
Receivables days
Receivables/ Sales revenue X365
Playables days
Payables/ Cost of sales X365
Inventory Turnover
Cost of goods sold/ Average inventories held
