Important Formulae Flashcards
Important formulas NOT included in the formula sheet.
Payback Period
initial investment cost/annual chas flow from investment
Break Even Point
fixed cost/contribution per unit
Contribution per Unit
selling price - variable cost
Total Contribution
contribution per unit x qty sold
Profit
total revenue - total cost
Sales Revenue
selling price x quantity sold
Margin of Safety
current level of output - break even point
Gross Proft
net sales revenue - cost of goods sold
Net Profit
(profit before interest and tax)
gorss profit - expenses
OR
total contribution - fixed cost
Net Sales Revenue
sales revenue - sales returns
Target Profit (x = qty)
x = (target profit - total fixed cost) / contribution per unit
Gross Profit Margin (%)
(gross profit/revenue) x 100
Net Profit Margin (%)
(net profit/revenue) x 100
ROCE
net profit /capital employed
Cost of Sales
opening stock + purchases - closing stock
