Formulas

Question 1

Profit

Answer 1

Revenue - total costs

Question 2

Revenue

Answer 2

Unit price x quantity sold

Question 3

Revenue per employee

Answer 3

Employee cost
—
revenue

Question 4

Unit cost

Answer 4

Total costs
—
output

Question 5

Average cost

Answer 5

Total costs
—
number of units

Question 6

Gross profit

Answer 6

Sales revenue - variable costs

Question 7

Operating profit

Answer 7

Gross profit - variable costs

Question 8

Gross profit margin

Answer 8

Gross profit
— X 100
Revenue

Question 9

Operating profit margin

Answer 9

Operating profit
— X100
Revenue

Question 10

(Profit margin)

Answer 10

Profit
— X100
Revenue

Question 11

Margin of safety

Answer 11

Actual level of output - break even level of output

Question 12

Break even

Answer 12

Fixed costs
—
Contribution per unit

Question 13

Labour turnover

Answer 13

Number of employees leave
— X100
Number of employees at start

Question 14

Labour productivity

Answer 14

Output in period
—
Number of employees

Question 15

Employee retention

Answer 15

Number of employees remain for period
— X100
Number of employees start in period

Question 16

Employee cost as a % of turnover

Answer 16

Employee cost
— X100
Turnover

Question 17

Expected value

Answer 17

P(1) x outcome (1) x P(2) x outcome (2) etc.

Question 18

Net gain

Answer 18

Expected value - intital cost

Question 19

Net

Answer 19

(Operating profit + income) - overall expenditure

Question 20

Net cash

Answer 20

Inflow - outflow

Question 21

Capacity utilisation

Answer 21

Current actual output
— X100
Maximum possible output

Question 22

YED (income elasticity)

Answer 22

% change in demand
—
% change in income

Question 23

PED (price elasticity)

Answer 23

% change in demand
—
% change in price

Question 24

Market capitalisation

Answer 24

Number of shares issued x share price

Question 25

Market share %

Answer 25

Sales
— X100
Total sales in market

Question 26

Profit for the year margin

Answer 26

Profit for the year
— X100
Revenue

Question 27

Budget variance

Answer 27

Budgeted figure - actual figure

Question 28

ROCE

Answer 28

Operating profit
— X100
Capital employed

Question 29

Capital employed

Answer 29

Total equity + non-current liabilities

Question 30

Current ratio

Answer 30

Current assets
— : 1
Current liabilities

Question 31

Gearing

Answer 31

Non-current liabilities
— X100
Capital employed

Question 32

Payable days

Answer 32

Payables
— X365
Cost of sales

Question 33

Receivable days

Answer 33

Receivables
— X365
Revenue

Question 34

Inventory turnover

Answer 34

Cost of sales
—
Inventory

Question 35

Return on investment

Answer 35

Profit from investment
— X100
Cost of investment

Question 36

Total contribution

Answer 36

Total revenue - variable costs

Contribution per unit X units produced/ sold

Question 37

Contribution per unit

Answer 37

Selling price - variable costs per unit

Question 38

Profit for the year

Answer 38

Operating profit + other profit - net finance cost - tax

Question 39

Total variable costs

Answer 39

Variable costs per unit X quantity sold

Question 40

Working capital

Answer 40

Current assets - current liabilities

Question 41

Added value

Answer 41

Sales revenue - cost of brought in goods and services