Formulas Flashcards
Revenue?
Selling price* number of units
Variable cost?
Variable cost per unit*number of units sold
Total cost?
Fixed costs+variable costs
Profit?
Total revenue-total costs or
Total contribution- fixed costs or margin of safety* contribution per unit
Market capitalisation of a business?
Number of shares issues*current share price
Net gain
Expected value-initial cost of decision
Market growth%?
Change in size of market/ original size of market*100
expected value of a decision with two possible outcomes?
(Pay off A* probability of A) +(pay off B* probability of B)
Market share%
Sales of one product or brand or business/ total sales of the market* 100
Added value?
Sales revenue-cost of bought good or service
Labour productivity?
Output over time period/ number of employees
Unit cost( average cost)
Total costs/ number of units of output
Capacity utilisation %?
Actual output/ maximum possible output*100
Return on investment%?
Profit from the investment£/ cost of the investment*100
Gross profit?
Revenue-cost of sales
Operating profit
Gross profit- operating expense (overheads)
Profit for the year?
Operating profit+ profit from other activities- net finance cost- tax
Gross profit margin%
Gross profit/ revenue* 100
Operating profit margin %?
Operating profit /revenue* 100
Profit for the year margin %?
Profit for the year/ revenue*100
Variance?
Budgeted figure- actual figure
Contribution per unit?
Selling price-variable cost per unit
Total contribution?
Contribution per unit* units sold or total revenue-total variable costs
Break even output?
Fixed costs/ contribution per unit
Margin of safety?
Actual level of output- break even level of output
Labour turnover%?
Number of staff leaving/ number of staff employed by business *100
Employee cost as a percentage of turnover?
Employee costs/ turnover*100
Labour cost per unit?
Labour costs/ units of output
Price elasticity of demand?
Percentage change in demand/ percentage change in price
Income elasticity of demand?
Percentage change in demand/ percentage change in consumer income
Net cash?
Cash in- cash out
Closing bank balance?
Opening balance+ net cash flow
Absenteeism %?
Number of staff absent in one day/ total number of staff100 or number of days taken off through absence/ total days worked by the workforce in same time period 100
