Theme 1 & 2 (Formulas) Flashcards
Market Share?
(Business sales/Total market sales) x 100
Price Elasticity of Demand? (PED)
(% change in quantity demanded) / (% change in price)
Income Elasticity of Demand? (YED)
(% change in quantity demanded) / (% change in income)
Net Cash Flow?
Total Inflows - Total Outflows
What is Sales Volume?
Total number of Units sold over a period of time.
Sales Revenue?
Number of Units sold x Selling price
Total Variable Costs
Number of units sold x Variable cost per unit
Total Costs?
Fixed Costs + Variable Costs
Contribution per Unit?
Selling price per unit - Variable cost per unit
Total Contribution?
Contribution per unit x Number of units sold
Break even?
Fixed Costs / Contribution per unit
Gross Profit?
Sales Revenue - Variable costs (Direct costs)
Operating Profit?
Gross profit - Fixed costs (Indirect costs)
Net profit?
Operating profit + or - Bank interest & tax
Gross Profit Margin?
(Gross profit / Sales Revenue) x 100
Operating Profit Margin?
(Operating Profit / Sales revenue) x 100
Net Profit Margin?
(Net Profit / Sales revenue) x 100
Current Ratio?
Current Assets / Current Liabilities
Acid Test Ratio?
(Current Assets - Stock) / Current Liabilities
Labour Productivity?
Output in a period (units) / Number of Employees in that period
Capacity Utilisation?
(Actual level of Output / Maximum possible Output) x 100
% change?
(Difference between old & new amount / old amount) x 100
What is Favourable Variance?
When actual costs are less than budgeted AND/OR when actual sales are more than budgeted.
What is Adverse Variance?
When actual costs are more than budgeted AND/OR when actual sales are less than budgeted.
