Finance Formulae

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  • Created by: Howwise
  • Created on: 16-11-21 09:41
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  • Formulae Finance
    • Revenue, cost, profit and loss
      • Revenue = Price x quantity
      • Total cost =  (Total) Variable Cost +     ( Total) Fixed Cost
      • (Total) Variable Cost = Variable Cost per unit      x Quantity
      • Variable Cost (per unit)  = Total Variable Cost / Quantity 
      • (Total) fixed cost = sum of all fixed cost
      • Profit / loss = Total Revenue- Total Cost
      • Gross Profit = Total Revenue – Cost of Sales
      • Gross profit margin = gross profit/ Total Revenue X 100 
      • Net profit = Total Revenue – Cost of sales - expenses
      • Net profit margin  = Net profit / Total Revenue X 100 
    • Average Rate of Return
      • Total profit from the investment               Total income received from an investment over a given period of      time – cost of the investment   Average profit from the investment          Total profit from the investment/ Number of years   Average rate of return                      Average profit from the investment / Cost of the investment      x 100 
    • Break even
      • Breakeven = Fixed Cost / Selling price - Variable Cost
      • Contribution per unit - Selling price - Variable Cost
    • Cash Flow
      • Net Cash flow = Total inflow - Total outflow
      • Closing balance = Net cash flow + opening balance

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