theme 2 equations

Question 1

formula for net cash flow

Answer 1

total inflows - total outflows

Question 2

formula for closing balance

Answer 2

opening balance + net cash flow

Question 3

formula for sales volume/quantity

Answer 3

selling price

Question 4

formula for sales revenue

Answer 4

sales quantity x selling price

Question 5

formula for total costs

Answer 5

total fixed costs + total variable costs

Question 6

formula for average variable costs

Answer 6

output

Question 7

formula for average fixed costs

Answer 7

output

Question 8

formula for average total costs

Answer 8

output

Question 9

formula for contribution

Answer 9

sales revenue - variable costs

Question 10

formula for contribution per unit

Answer 10

price per unit - variable costs per unit

Question 11

formula for break even point

Answer 11

contribution per unit (price per unit - variable costs per unit0)

Question 12

Formula for margin of safety

Answer 12

current output - break even output

Question 13

formula for variance

Answer 13

actual level - budgeted level

Question 14

gross profit

Answer 14

revenue - cost of sales

Question 15

operating profit

Answer 15

gross profit - other operating costs

Question 16

profit for the year

Answer 16

operating profit - tax/interest

Question 17

gross profit margin (%)

Answer 17

gross profit
—————– x 100
revenue

Question 18

operating profit margin (%)

Answer 18

operating profit
———————— x 100
revenue

Question 19

profit for the year margin (%)

Answer 19

profit for the year
————————– x100
revenue

Question 20

current ratio (expressed as a ratio)

Answer 20

current liability

Question 21

Acid test ratio

Answer 21

current liability

Question 22

capacity utilisation (%)

Answer 22

current output
———————– x 100
maximum possible output