Finance Business equations

• How to work out revenue?

  selling price x quantity sold
• How to work out profit?

  total revenue - total costs
• How to work out variable costs?

  quantity sold x variable cost per unit
• How to work out total costs?

  fixed costs + variable costs
• How to work out gross profit?

  Sales revenue - cost of sales
• How to work out gross profit margin?

  Gross profit/sales revenue x 100
• How to work out net profit?

  Gross Profit - Other Operating Expenses
• How to work out net profit?

  Sales revenue - Total costs of business
• How to work out net profit margin?

  Net profit / revenue x 100
• How to work out average rate of return on an investment?

  (total net profit / number of years) / initial investment x 100
• How to work out break even point

  fixed costs/

  contribution(sales price - variable costs)