Important formulas Flashcards
1
Q
Gross profit
A
Sales revenue - cost of goods sold
2
Q
Gross profit margin
A
Gross profit
—————– *100
Revenue
3
Q
Mark up
A
Gross profit
—————— *100
Cost of sales
4
Q
Net profit margin
A
Net profit
————– *100
Revenue
5
Q
Costs of goods
A
Opening inventory + purchases - closing inventory
6
Q
Return on capital employed
A
Net profit before interest and tax
———————————————– *100
Capital employed
7
Q
Current ratio
A
Current liabilities
8
Q
Liquid capital ratio
A
Current liabilities
9
Q
Profit or loss for the year
A
Gross profit - expenses + other income
10
Q
Trade receivable days
A
(Trade receivable / credit sales) *100
11
Q
Trade payable day
A
(Trade payables / credit purchases) *100
12
Q
Inventory turnover
A
(average inventory / costs of sales) *365
13
Q
Average inventory
A
2
