Theme 2 Flashcards
Sales volume
Revenue / Price
Sales revenue
Price x Quantity sold
Total costs
Fixed costs + Variable costs
Breakeven
Fixed costs / Contribution per unit
Contribution
Selling price - Variable cost per unit
Total contribution
Contribution per unit x Quantity sold
Margin of safety
Total output - Break-even level of output
Gross profit
Sales revenue - Cost of Sales
Gross profit margin
Gross profit / Revenue x100
Operating profit
Gross profit - Expenses
Operating profit margin
Operating profit / Revenue x100
Working capital
Current assets - Current liabilities
Productivity
Output per time period / Input per time period
Labour productivity
Output per time period / No. workers or hours worked
Total variable costs
Total costs - Fixed costs
OR
Variable costs per unit x Quantity sold
Average variable costs
Variable costs / Output
Profit
Total revenue - Total costs
Net profit
Operating profit - Interest and tax
Net profit margin
Net profit / Revenue x100
Current ratio
Current assets / Current liabilities
Acid test ratio
Current assets - inventory / Current liabilities
Capital productivity
Output per time period / No. of machines
Capacity utilisation
Actual output / Maximum output x100
