# A Level Business Formulae Flashcards

• Created by: 9023448!
• Created on: 15-05-18 16:51
Total Costs
Variable Costs + Fixed costs
1 of 41
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)
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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)
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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
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Favourable variance
When actual figure is greater than budgeted figure
22 of 41
When actual figure is lower than budgeted figure
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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
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Break-even Output
Fixed costs / Contribution per unit
26 of 41
Margin of Safety
Actual output - Breakeven output
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Gross Profit Margin
Gross Profit ÷ Sales Revenue (x100)
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Operating Profit Margin
Operating Profit ÷ Sales Revenue (x100)
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Profit for the Year Margin
Profit for the Year ÷ Sales Revenue (x100)
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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
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## Other cards in this set

### Card 2

#### Front

Total Revenue - Total costs

### Card 3

#### Front

Contribution - Fixed costs

### Card 4

#### Front

Variable cost per unit x Number of units sold

### Card 5

#### Front

Average price x Number of units sold