Theme 2 and 3 Flashcards
Sales Volume
total number of units sold over a period of time
Sales Revenue
number of units sold x unit price
Total variable costs
number of units sold x variable costs per unit
Total costs
fixed costs + variable costs
Gross profit
sales revenue - cost of sales
Operating profit
gross profit - overheads
net profit
operating profit +/- finance costs
opening balance
previous months closing balance
closing balance
opening balance +/- finance costs
net cash flow
total inflows- total outflows
break even
fixed costs/ contribution per unit
contribution per unit
selling price per unit- variable cost per unit
total contribution
contribution per unit x number of units sold
margin of safety
actual/projected sales volume- break even sales volume
budget variance
actual - budget
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
return of capital employed
(operating/net profit / capital employed) x 100
current ratio
current assets / current liabilities
acid test ratio
(current assets- stock) / current liabilities
gearing ratio
(non current liabilities/ capital employed) x 100
productivity
output per period/ number of employees in that period
capacity utilisation
(actual output/ maximum output) x 100
ARR
average net cash flow for life of project/ project costs x 100
net present value
each year net cash flow x discount factor
labour turnover
(number of employees that have left/ average number of employees) x 100
labour retention rate
(number of employees that haven’t left/ average number of employees) x 100
abseentism
(number of days absence taken by employees/ total possible ‘workable’ days) x 100
