Paper 2 formulas Flashcards by Max Holdich

Q

What is Total Revenue?

A

Selling price x Quantity sold

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Q

What are Total Variable Costs?

A

Variable cost per unit x Quantity

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Q

What are Total Costs?

A

Fixed costs + Variable costs

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Q

What is Net Cash Flow?

A

Cash inflows - Cash outflows

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Q

What is Opening Balance?

A

Closing balance from previous period

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Q

What is Closing Balance?

A

Opening balance + Net cash flow

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Q

Contribution per unit

A

Selling price - Variable cost per unit

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Q

Break even output

A

Fixed costs / Contribution per unit

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Q

What is the formula for Total contribution?

A

Contribution per unit x Quantity

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Q

Margin of safety

A

Actual/forecast output - Break even output

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Q

Profit

A

Total revenue - Total costs

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Q

Profit (alternative calculation)

A

Total contribution - Fixed costs

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Q

What is the formula for Profit?

A

Margin of safety x Contribution per unit

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Q

How is Variance calculated?

A

Actual - Budgeted figures

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Q

What is the formula for Gross profit margin?

A

Gross profit / Revenue x 100

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Q

What is the formula for Operating profit margin?

A

Operating profit / Revenue x 100

Q

What is the formula for Profit for the year margin?

A

Profit for the year / Revenue x 100

Q

What is Gross Profit?

A

Revenue - Cost of sales

Q

What is Operating Profit?

A

Gross profit - Operating expenses

Q

What is Profit for the Year?

A

Operating profit - Tax / Interest / One off payment

Q

What is the Current Ratio?

A

Current assets / Current liabilities

Q

What is the Acid Test Ratio?

A

Current assets - Stock / Current liabilities

Q

What is Capacity Utilisation?

A

Actual output / Maximum possible output x 100