All Formulae

Question 1

Revenue

Answer 1

Price x units sold

Question 2

Variable costs

Answer 2

Cost per unit x units sold

Question 3

Total costs

Answer 3

Fixed costs + variable costs

Question 4

Profit

Answer 4

Revenue - total costs

Question 5

Profit (contribution)

Answer 5

Total contribution - fixed costs

Question 6

Market capitalisation

Answer 6

Shares issued x current share price

Question 7

Net gain (decision tree)

Answer 7

Expected value - initial cost

Question 8

Expected value

Answer 8

(Pay off A x probability) + (Pay off B x probability)

Question 9

Market growth

Answer 9

Change in size over period/original size x 100

Question 10

Market share

Answer 10

Sales of product/brand
/ total sales in market x100

Question 11

Added value

Answer 11

Revenue- costs of materials and components.

Question 12

Labour productivity

Answer 12

Output over period / number of employees

Question 13

Unit costs

Answer 13

Total costs / output

Question 14

Capacity utilisation

Answer 14

Actual output / maximum output x100

Question 15

Return on investment

Answer 15

Profit / cost x 100

Question 16

Gross profit

Answer 16

Revenue - cost of sales

Question 17

Operating profit

Answer 17

Gross profit - operating expenses

Question 18

Profit for year

Answer 18

Operating + profit from other activities - net finance costs - tax

Question 19

Profit margins

Answer 19

Profit / revenue x 100

Question 20

Variance

Answer 20

Budgeted figure - actual figure

Question 21

Contribution per unit

Answer 21

Price - variable costs

Question 22

Total contribution

Answer 22

Contribution x units sold
Total revenue - total variable costs

Question 23

Break even output

Answer 23

Fixed costs / contribution per unit

Question 24

Margin of safety

Answer 24

Actual output - break even output

Question 25

Labour turnover

Answer 25

No. staff leaving / no. Staff employed x 100

Question 26

Employee costs as a % of turnover

Answer 26

Employee costs / turnover x100

Question 27

Labour costs per unit

Answer 27

Labour costs / output

Question 28

Capital employed

Answer 28

Total equity + non current liabilities

Question 29

ROCE

Answer 29

Operating profit / capital employed x 100

Question 30

Current ratio

Answer 30

Current assets / current liabilities

Question 31

Gearing

Answer 31

Non current liabilities / capital employed x 100

Question 32

Payables days

Answer 32

Payables / cost of sales x 365

Question 33

Receivables days

Answer 33

Receivables / revenue x 365

Question 34

Inventory turnover

Answer 34

Cost of sales / average inventories held

Question 35

Average rate of return

Answer 35

Average annual return / initial cost of project x 100

Question 36

Price elasticity of demand (PED)

Answer 36

% change in demand / % change in price

Question 37

Income elasticity of demand (YED)

Answer 37

% change in demand / % change in incomes

Question 38

Float time

Answer 38

LFT - duration - EST (previous node)