formulas Flashcards
1
Q
contribution margin
A
sales price - variable costs
2
Q
contribution margin ratio
A
contribution margin / sales price
3
Q
break even analysis
A
fixed costs / contribution margin
4
Q
target profit analysis
A
(fixed costs + target profit) / contribution margin
5
Q
residual income
A
income - (minimum rate of return * average operating assets)
6
Q
total budgeted costs
A
fixed costs + variable costs
7
Q
ROI
A
controllable margin / average operating assets
8
Q
controllable margin
A
contribution margin - fixed costs
9
Q
average operating costs
A
(opening operating assets + closing operating assets) / 2
10
Q
afc and avc
A
afc = total fixed costs / total number of units produced
avc = total variable cost / total number of units produced
