A Level Business Formulae Flashcards 4.0 / 5 based on 1 rating ? BusinessBusinessA2/A-levelAQA Created by: 9023448!Created on: 15-05-18 16:51 Total Costs Variable Costs + Fixed costs 1 of 41 Profit (traditional) Total Revenue - Total costs 2 of 41 Profit (contribution) Contribution - Fixed costs 3 of 41 Total Variable Costs Variable cost per unit x Number of units sold 4 of 41 Sales Revenue Average price x Number of units sold 5 of 41 Market Capitalisation Share price x Number of shares issued 6 of 41 Expected Value (decision trees) (Pay-off A x Probability of A) + (Pay-off B x Probability of B) 7 of 41 Net Gain (decision trees) Expected value - Cost of decision 8 of 41 Market Size The volume or value of all goods sold in the market over a period of time 9 of 41 Sales Volume The volume of goods sold by a business over a period of time 10 of 41 Sales Value Total sales revenue of a business over a period of time 11 of 41 Market Growth % change in size of market between year X and Y ÷ Size of market in year X (x100) 12 of 41 Sales Growth % change in sales between year X and Y ÷ Sales in year X (x100) 13 of 41 Market Share Sales ÷ Total sales in market (x100) 14 of 41 Price Elasticity of Demand (PED) % change in quantity demanded ÷ % change in price 15 of 41 Labour Productivity Output ÷ Number of employees 16 of 41 Unit Costs Total costs of production ÷ Total quantity produced 17 of 41 Capacity Utilisation Actual output ÷ Maximum output possible (x100) 18 of 41 Operating Profit Sales Revenue - (Cost of sales + Operating expenses) 19 of 41 Profit for the Year (Operating profit + Profit from other activities) - (Finance costs + Taxation) 20 of 41 Variance A difference between a budgeted figure and an actual figure 21 of 41 Favourable variance When actual figure is greater than budgeted figure 22 of 41 Adverse variance When actual figure is lower than budgeted figure 23 of 41 Contribution Per Unit Selling price - Variable cost per unit 24 of 41 Total Contribution Contribution per unit x Total units produced OR Total revenue - Total variable costs 25 of 41 Break-even Output Fixed costs / Contribution per unit 26 of 41 Margin of Safety Actual output - Breakeven output 27 of 41 Gross Profit Margin Gross Profit ÷ Sales Revenue (x100) 28 of 41 Operating Profit Margin Operating Profit ÷ Sales Revenue (x100) 29 of 41 Profit for the Year Margin Profit for the Year ÷ Sales Revenue (x100) 30 of 41 Labour Turnover Number of staff leaving ÷ Number of staff employed (x100) 31 of 41 Employee Retention Rate Number of staff stayed ÷ Number of staff employed (x100) 32 of 41 Labour Costs (% of Revenue) Labour costs ÷ Sales revenue (x100) 33 of 41 Labour Cost per Unit Labour costs ÷ Total output (x100) 34 of 41 Return on Capital Employed (ROCE) Operating profit ÷ (Total equity + Non-current liabilities) 35 of 41 Current Ratio Current assets ÷ Current liabilities 36 of 41 Gearing Ratio Non-current liabilities ÷ (Total equity + Non-current liabilities) 37 of 41 Payables Days Payables ÷ Cost of sales (x100) 38 of 41 Receivables Days Receivables ÷ Cost of sales (x100) 39 of 41 Inventory Turnover Cost of goods sold ÷ Average inventories held 40 of 41 Average Rate of Return (ARR) (Net return from project ÷ number of years) ÷ Initial investment cost 41 of 41
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