Brainscape's Knowledge GenomeTM

Browse over 1 million classes created by top students, professors, publishers, and experts.


See full index

Management Information > MI Formula To Learn > Flashcards

MI Formula To Learn Flashcards

1
Q

Periodic weighted average price

A

Cost of opening inventory + Total cost of receipts in period

/ Units in opening inventory + Total units received in period

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

OAR (overhead absorption rate)

A

Production overhead / Activity level

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

Overhead absorbed

A

Actual activity (eg labour hours) × Predetermined OAR

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

Predetermined OAR

A

Budgeted overhead / Budgeted activity level

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

Difference in marginal and absorption costing profit

A

Change in stock in units × OAR per unit

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

Inventory turnover period

A

Average inventory / Cost of sales x 365

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

Rate of inventory turnover

A

Cost of sales / Average inventory

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

Receivables collection period

A

Average receivables / Annual sales revenue x 365

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

Payables payment period

A

Average payables / Annual purchases x 365

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

Current ratio

A

Current Assets / Current liabilities

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

Quick (liquidity/acid test) ratio

A

Current Assets - Inventories / Current Liabilities

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

Calculating the cash operating cycle

A 
Raw materials holding period  +
Average production period +
Average inventory-holding period +
Average receivables collection period -
Average payables payment period =
Length of cycle
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

Economic order quantity (EOQ)

A

Sq root of 2CoD /Ch where
D = Annual demand in units
Co= Cost of placing an orde
Ch= Annual cost of holding one unit in inventory

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

Return on investment (ROI)

A

Controllable divisional profit / Divisional capital employed x 100%
Profit should be before interest and tax. Capital employed can be the opening value or average value of opening and closing capital employed. ROI enables performance in different divisions to be compared or a new investment to be appraised.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

Residual income (RI)

A

Controllable profit – Imputed interest charge on controllable investment

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

Breakeven point (BEP

A

Contribution required to breakeven / Contribution per unit

17
Q

Breakeven point (BEP

A

Total fixed costs / Contribution per unit

18
Q

Contribution ratio

A

Contribution per unit / Sales price per unit x 100%

19
Q

Breakeven revenue

A

Contribution required to break even / Contribution ratio

20
Q

Breakeven revenue

A

Fixed costs / Contribution ratio

21
Q

Margin of safety

A

Budgeted sales – Breakeven sales

22
Q

Margin of safety %

A

Budgeted sales – Breakeven sales / Budgeted sales x 100%

23
Q

Sales volume to achieve target profi

A

Fixed Cost + Required Profit / Contribution per unit

24
Q

Accounting rate of return (ARR) 1

A

Average annual accounting profit / initial investment x 100%

25
Q

Accounting rate of return (ARR) 2

A

Average annual accounting profit / Average investment x 100%

the average investment is calculated as 1/2 (initial investment + final or scrap value)

26
Q

Compounding
The formula for the future value or terminal value of an investment plus accumulated interest after n time periods is V =

A

V = X(1 + r)n
where V is the future value or terminal value of the investment with interest
X is the initial or ‘present’ value of the investment
r is the compound rate of return per time period, expressed as a decimal (so 10% = 0.10, 5% = 0.05 etc)
n is the number of time periods
Usually r is an annual rate of return
and n is the number of year

27
Q

Discounting formula to calculate the present value (X) of a future sum of money (V) at the end of n time periods is

A

is X = V × 1/(1+r)n.

28
Q

perpetuity

The present value of a perpetuity of £a per annum, starting in 1 year is calculated as

A

cash flow x 1 / r

where r is the annual discount rate

29
Q

IRR interpolation formula

A

IRR = a + NPVa / NPVa - NPVb (b-a)

where a is the first discount rate giving NPVa
(note: this should be the lower discount rate which gives the higher NPV)
b is the second discount rate giving NPVb

30
Q

Profit Margin

A

A percentage of sales price. E.g a profit margin of a good costing 80 to make and 100 to sell is 20%; profit/sales price

31
Q

Profit Markup

A

A percentage of the cost of the good. E.g a good which cost 80 to make with a 20% mark up would sell for 96.

32
Q

Profit 1

A

Contribution - FC

33
Q

Profit 2

A

TR - TC

Management Information (1 decks)

Brainscape helps you reach your goals faster, through stronger study habits.
© 2024 Bold Learning Solutions. Terms and Conditions