formula

• What is the formula for revenue?

  Revenue = Price x Quantity
• How do you calculate total variable cost?

  Total variable cost = Variable cost for one unit x Quantity
• What does average (unit) cost represent?

  Average cost = Total cost / Quantity
• What is the formula for total costs?

  Total costs = Fixed costs + Total variable costs
• How is profit calculated?

  Profit = Revenue – Total costs
• What is the formula for variance?

  Variance = Actual - Budget
• How is net cash flow calculated?

  Net cash flow = Receipts – Payments
• What does the opening balance represent?

  Opening balance = Last month’s closing balance
• How is the closing balance calculated?

  Closing balance = Opening balance + Net cash flow
• What is the formula for percentage change?

  Percentage change = (Difference / Original) x 100
• How do you calculate breakeven point?

  Breakeven = Fixed costs / Unit contribution
• What is unit contribution?

  Unit contribution = Selling price – variable cost
• How is margin of safety calculated?

  Margin of safety = Output - Breakeven
• What does total contribution represent?

  Total contribution = Total revenue – Total variable costs
• How is total contribution calculated from unit contribution?

  Total contribution = Unit contribution x Quantity
• How is profit calculated from total contribution?

  Profit = Total contribution – Fixed costs
• What is gross profit?

  Gross profit = Revenue – Cost of sales
• How is operating profit calculated?

  Operating profit = Gross profit – Expenses
• What is profit for the year (net profit)?

  Profit for the year = Operating profit – Finance costs
• How is gross profit margin calculated?

  Gross profit margin = (Gross profit / Revenue) x 100
• What is the formula for operating profit margin?

  Operating profit margin = (Operating profit / Revenue) x 100
• How is profit for the year (net profit) margin calculated?

  Net profit margin = (Net profit / Revenue) x 100
• What is the formula for net assets?

  Net assets = Total assets – Total liabilities
• How is the current ratio calculated?

  Current ratio = Current assets / Current liabilities
• What does the acid test ratio measure?

  Acid test ratio = (Current assets – Inventories) / Current liabilities
• How is working capital calculated?

  Working capital = Current assets – Current liabilities
• What is the formula for labour productivity?

  Labour productivity = Output / Worker
• How is capacity utilisation calculated?

  Capacity utilisation = (Current output / Maximum possible output) x 100
• How do you exchange GBP into foreign currency?

  GBP x exchange rate
• How do you exchange foreign currency into GBP?

  Foreign currency / exchange rate