BUSS2 Calculations and Formulas

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Net Profit Margin

Net profit (before tax)                   x 100


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Return on capital

Net profit (before tax)            x 100

    Capital Invested

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How to improve profit

  • increase quantity sold
  • increase selling price
  • reduce variable costs per unit
  • increase output
  • reduced fixed costs
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Labour productivity

   Output per period (units)       

Number of employees at work

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Labour turnover

Number of employees leaving during period      x 100

  Average number employed during period

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Number of days taken off for unauthorised absence (during period) x 100

            Total days worked by workforce over the period

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Capacity utilisation

    Actual level of output            x 100

Maximum possible output

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