formulas for business Flashcards

(33 cards)

1
Q

profit

A

profit =revenue - costs

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2
Q

total costs

A

total costs = fixed costs + variable costs

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3
Q

percentage change

A

percentage change = (final value - initial value ) / initial value x 100

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4
Q

percentage growth

A

percentage growth = (change in sales / existing sales ) x 100

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5
Q

market share

A

market share = (sales of business / total market sales ) x 100

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6
Q

market capitalisation

A

market capitalisation = number of shares x share price

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7
Q

PED

A

PED = %change in demand / %change in price

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8
Q

YED

A

YED = %change in demand / %change in income

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9
Q

contribution

A

contribution = sales revenue - variable costs

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10
Q

contribution per unit

A

contribution per unit = sales price per unit - variable costs per unit

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11
Q

breakeven

A

breakeven = fixed costs / contribution per unit

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12
Q

labour turnover

A

labour turnover =( number of staff leaving per year / average number of staff ) x 100

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13
Q

labour retention

A

labour retention = number of employees with one or more years of service / overall workforce numbers

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14
Q

labour productivity

A

labour productivity = total output / number of employees

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15
Q

labour costs as a % of turnover

A

(labour costs / revenue ) x 100

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16
Q

labour cost per unit

A

labour cost per unit = labour costs / output

17
Q

gross profit

A

(revenue or sales) - (cost of sales or variable costs

18
Q

operating profit

A

gross profit - fixed costs

19
Q

net profit or profit of the year

A

(operating profit - tax) +- interest

20
Q

expected value (decision trees)

A

EV = (probability x outcome 1) + (probability x outcome 2)

21
Q

current ratio

A

current ratio = current assets / current liabilitiesgr

22
Q

gearing ratio

A

gearing ratio = (non current liabilities / capital employed) x 100

23
Q

capital employed

A

capital employed = total equity + non-current liabilities

24
Q

profit margin

A

profit margin =( profit / revenue ) x 100

25
return on capital employed
ROCE = (operating profit / capital employed) x 100
26
inventory turnover ratio
costs of sales / inventory( number of per year stock is replenished)
27
receivables days ratio
(trade receivables / revenue) x 365
28
payables days ratio
(trade payables / cost of sales) x 365
29
payback
number of full years + (the amount of cost left / the revenue generated the next year )
30
average rate of return
net return = total net cash flows - initial outlay average annual return = net return / life expectancy average rate of return = (average annual return / initial outlay ) x 100
31
net present value
net cash flow x discount factor
32
net gain
ev - costs
33
balance sheet format
non-current assets current assets current liabilities net current liabilities non-current liabilities net assets (same) total equity (same)