Studied by 3 peopleRevenue
price x quantity sold
Total Costs
fixed costs + variable costs
Gross Profit
sales revenue - cost of goods sold
Profit
total revenue - total costs
Net Profit
gross profit - all other expenses (total costs)
Break-Even
fixed costs / contribution per unit
Contribution
selling price - variable costs
Total equity/Shareholders funds
share capital + reserves
Capital employed
share capital + retained earnings + long term borrowings
Depreciation
original cost -residual value/useful life
ROCE
operating profit/capital employed x 100
Operating profit
gross profit - operating expenses
Current ratio
current assets/current liabilities
Acid test ratio
(current assets -inventory)/current liabilities
Gearing Ratio
non-current liabilities/capital employed x 100
Gross profit margin
gross profit/sales revenue x 100
Net profit margin
operating profit/sales revenue x 100
Market Growth
change in size of market / original size x 100
Market Share
sales of one product or business/total sales in market x 100
Variable Costs
variable cost per unit x number of units sold
Margin of Safety
actual level of output - breakeven level of output
Net Cash Flow
total inflows - total outflows
Closing Balance
opening balance + net cash flow
Opening Balance
closing balance from previous month
Retained Profit
net profit - tax and dividends
Absenteeism
total number of staff absence annually/total number of working days they should have worked x 100
Labour Productivity
output per time period / number of employees
Labour Turnover
number of staff leaving / average number of staff employed x 100
Added Value
price that the product or service is sold at - cost of producing the product
Capital Productivity
output/capital employed
Capacity Utilisation
actual level of output / maximum possible output x 100
Index Numbers
value in period/value in base period x 100
Price Elasticity of Demand
% change in quantity demanded / % change in price
Income Elasticity of Demand
% change in quantity demanded / % change in income
3 point moving average
3 adjacent figures/3
Variance
budgeted figure - actual
Working Capital
current assets - current liabilities
Expected Value
calculated by multiplying the estimated financial effect by its probability
Net Gain
add the expected value of each outcome and deduct the costs associated with the decision
EST
EST of previous activity + duration of previous activity (work from left to right)
LFT
LFT at the end of following activity - duration of following activity (work from right to left
Float Time
LFT at end of task - duration of task - EST at start of task
Payback
cost of initial investment / net cash earned per time period
ARR (%)
average annual profit/cost of investment x 100
Total Contribution
contribution per unit × units sold
DCF/NPV
-multiply each year's net cash flow by the discount rate for the year
-total the discounted net cash flows and then subtract the initial investment
Note
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