Paper 1 Calculations

Question 1

labour productivity =

Answer 1

(total output/number of employees)

–> measures efficiency of workforce

Question 2

labour cost per unit =

Answer 2

(total labour costs/total output)

–> measures total labour cost

Question 3

employee costs as a % of turnover =

Answer 3

(employee costs/sales turnover)

–> proportion of revenue spent on employees

Question 4

labour turnover =

Answer 4

(number of staff leaving/average number of staff) x 100

–> measures number of employees leaving as a percentage of the size of the workforce

Question 5

gearing ratio =

Answer 5

(non-current liabilities/capital employed) x 100

–> how much of the business finance is debts

Question 6

ROCE ratio =

Answer 6

(operating profit/capital employed) x 100

–> how much money the business has made from. its money borrowed

Question 7

Income statement

Answer 7

Revenue -
Variable costs =
Gross profit -
Fixed costs =
Operating profit -
Tax =
Profit for the year

Question 8

Breakeven output =

Answer 8

Fixed costs / Contribution per unit

Question 9

payables ratio

Answer 9

trade payables/cost of sales x 365

Question 10

receivables days ratio

Answer 10

trade receivables/revenue x 365