Formulas Flashcards

1
Q

Net cash flow

A

Total cash inflow - total cash outflow

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2
Q

Closing balance

A

Opening balance + net cash flow

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3
Q

Total revenue

A

Selling price x quantity sold

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4
Q

Total costs

A

Fixed costs + variable costs

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5
Q

Profit (2)

A

Total revenue - total costs

Or

Gross profit - expenses

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6
Q

Total contribution (f)

A

Sales revenue - total variable costs

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7
Q

Contribution (per unit)

A

Selling price - variable cost (per unit)

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8
Q

Profit (using contribution)

A

Contribution per unit x margin of safety

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9
Q

Break even

A

Total fixed costs/ contribution per unit

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10
Q

Margin of safety (2 formulas)

A

Actual sales - break even level of output

Or

Expected output (units/in case study) - break even quantity (cash flow chart)

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11
Q

Gross profit (f)

A

Sales revenue - costs of goods sold (cost of sales)

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12
Q

Costs of goods sold (cost of sales)

A

Opening inventory + purchases - closing inventory

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13
Q

Profit/loss for the year

A

Gross profit - expenses + other income

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14
Q

Net book value

A

Cost - depreciation

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15
Q

Net current assets

A

Current assets - current liabilities

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16
Q

Net assets

A

Non - current assets + net current assets - long term liabilities

17
Q

Capital employed (f)

A

Opening capital + profit for the year less drawings

. less drawings means money taken out the business
. if this isn’t included in the question then just add the profit for the year

18
Q

Balance sheet (what needs to balance)

A

Net assets = capital employed

19
Q

Gross profit margin/ratio

A

Gross profit/revenue x 100

20
Q

Mark up

A

Gross profit/cost of sales x 100

21
Q

Profit margin

A

Profit (for the year)/revenue x 100

22
Q

Return on capital employed (f)

A

Net Profit/capital employed x 100

23
Q

Current ratio

A

Current assets/current liabilities

24
Q

Liquid capital ratio

A

Current assets - inventory/current liabilities

25
Q

Trade receivable days

A

Trade receivables/credit sales x 365

26
Q

Trade payable days

A

Trade payables/credit purchases x 365

27
Q

Inventory turnover

A

Average inventory/costs of sales x 365

28
Q

Straight line method (deprecation)

A

Historic value - residual value
Divide by expected life

29
Q

Reducing balance depreciation formula

A

Historic value x percentage of depreciation

30
Q

Net profit margin (f)

A

Net profit/ revenue x 100

31
Q

Net profit (f)

A

Gross print - operating expenses and taxes

32
Q

Variable cost (f)

A

Materials plus wage

33
Q

Sales rev

A

Cost of sales + gross profit

34
Q

Selling price per unit (f)

A

Break even rev/break even quantity

35
Q

Working capital

A

current assets - current liabilities

36
Q

Fixed costs per month (f)

A

Break even x contribution per unit