Maths Flashcards
How do you calculate a percentage change?
New - old/ old x 100
How do you calculate a new figure?
Percentage change x old/ 100 + previous figure
How do you calculate profit for the year?
Operating profit + other profit - net finance costs - tax
How do you calculate profit for the year margin?
Profit for the year / sales revenue x100
How do you calculate gross profit?
Sales revenue - cost of sales
How do you calculate gross profit margin
Gross profit / sales revenue x 100
How do you calculate operating profit
Sales revenue - cost of sales - operating expenses
How to calculate operating profit margin
Operating profit / sales revenue x 100
How do you calculate current ratio (liquidity)
Current assets / current liabilities
Acid test
Current assets - stock / current liabilities
Gearing ratio
Non-current liabilities / total equity + non current liabilities x 100
ROCE
Operating profit / total equity + non-current liabilities x 100
Payables days
Payables (current liabilities or creditors) / cost of sales x 365
Receivables days
Receivables (current assets or debtors) / sales revenue x365
Inventory turnover
Cost of sales / cost of average stock held
Average rate of return
Total net profit / no. of years / initial cost x100
Net present value
Net return for each year x discount factor
Add all net return x discount factors, for each year up
Then minus the cost of the initial investment
Payback
Amount still needed to payback / amount paid back in that year x 12
Remember to do the cumulative chart
Labour turnover (%)
Number of staff leaving during the year / average number of staff employed during the year x 100
Labour productivity
Output per period / number of employees
Labour retention
Number of staff employed at end of period - number of leavers / number of staff employed at end of period X100
Low retention means the company only keeps a small % of their employees
Employee costs as a % of turnover
Employee costs / sales turnover X100
Labour cost per unit
Labour costs / units of output
Unit costs
Total costs of production / units output
Capacity
The maximum output with the resources currently available
Capacity utilisation
Output / capacity X100
Re-order level
Lead time (in days) X average daily usage + buffer stock level
Break even output
Fixed costs / contribution per unit
Margin of safety
Actual output - break even output
Contribution per unit
Selling price - unit variable cost
Total contribution
Total revenue - total variable costs
OR
Contribution per unit X number of units sold
Return on investment
Return on investment / cost of investment X100
Price elasticity of demand
%change in quantity demanded / %change in price
Income elasticity of demand
%change in quantity demanded / %change in real income
Total costs
Fixed costs + variable costs
Profit
Total revenue - total costs
OR
Total contribution - fixed costs
Variable costs (total variable costs)
Variable cost per unit x number of units sold
Total revenue
Selling price per unit x number of units sold
Market capitalisation
Number of issues shares x current share price
Market size (volume)
Quantity of goods and services produced in a particular market / a period of time (usually one year)
Market size (value)
Sales revenue in a market / time period (usually one year)
Sales volume
Quantity of G&S produced by a business / time period (usually a year
Sales value
Sales revenue of a business / time period (usually one year)
Market share
Sales of business / total sales in market X100
Added value
Sales revenue - cost of bought in G&S
Convert between currencies
E.g. €1.41 to £1
How to go from € to £
Divide the euros by 1.41
Convert between currencies
E.g. €1.41 to £1
How to go from £ to €
Multiply the pounds by 1.41
+ of payback
Easy
Quick
Simple
Help with cash flow
- payback
Value of money changes over time
So doesn’t consider time value of money
Encourages short termism
Based on estimates
+ of NPV
Considers time value of money
Helps with decision making as businesses can reject projects with a negative NPV
- of NPV
More complicated
Discount rates are estimated
+ of ARR
Tells you how much on average you’ll get back each year
Quick
Easy
Simple
- of ARR
Doesn’t consider time value of money
Based on estimates
Doesn’t tell you how much each year specifically, only on average each year
Total float time
LFT - duration - EST
