AQA Alevel business Equations 1.0 / 5 based on 1 rating ? BusinessequationsA2/A-levelAQA Created by: kar2311Created on: 26-02-19 15:59 what is the equation for revenue (Sales or Turnover)? Selling price per unit × Number of units sold 1 of 35 What is the equation for total variable costs? Variable cost per unit × Number of units sold 2 of 35 what is the equation for total costs? Fixed costs + Variable costs 3 of 35 what is the equation for Profit? Total revenue − Total costs 4 of 35 what is the equation for market capitalisation of a business? Number of issued shares × Current share price 5 of 35 What is the equation for net gain? Expected value − Initial cost of decision 6 of 35 What is the equation for Market growth (%)? (Change in the size of the market over a period / Original size of the market) × 100 7 of 35 What is the equation for market share (%)? (Sales of one product OR brand OR business) / (Total sales in the market) × 100 8 of 35 what is the equation for labour productivity? Output over a time period / no.employees 9 of 35 What is the equation for unit costs (average costs)? total costs / no.units of output 10 of 35 What is the equation for capacity utilisation? (Actual output / Max. possible output) X 100 11 of 35 What is the equation for Return on investment (%)? Profit from the investment (£) / Cost of the investment (£) × 100 12 of 35 What is the equation for gross profit? Revenue − Cost of Sales 13 of 35 what is the equation for Profit from Operations Gross profit − Operating Expenses 14 of 35 What is the equation for Profit For a Year? Operating profit + Profit from other activities − Net finance costs − Tax 15 of 35 What is the equation for Gross profit margin (%)? (Gross profit / revenue) X 100 16 of 35 What is the equation for operating profit margin? (operating profit / revenue) X 100 17 of 35 What is the equation for Profit for year margin(%)? (profit for year / revenue) X 100 18 of 35 What is the equation for variance? budgeted figure - actual figure 19 of 35 What is the equation for contribution per unit? selling price - variable costs per unit 20 of 35 What is the equation for total contribution? Contribution per unit × Units sold 21 of 35 What is the equation for break-even output? fixed costs / contribution per unit 22 of 35 What is the equation for margin of safety? Actual level of output − Break-even level of output 23 of 35 What is the equation for labour turnover? Number of staff leaving / Number of staff employed by the business × 100 24 of 35 What is the equation for Employee retention rate (%) for a particular time period (Number of employees who remained with the business for the whole period of time / Number of employees at start of the time period) X 100 25 of 35 What is the equation for Employee costs as percentage of turnover? (employee costs / turnover) X 100 26 of 35 what is the equation for laour costs per unit? (employee costs / turnover) X 100 27 of 35 What is the equation for return on capital employeed (%)? (Operating profit / (Total equity + non-current liabilities)) × 100 28 of 35 What is the equation for current ratio? current assets / current liabilities 29 of 35 What is the equation for gearing(%)? (Non-current liabilities / Total equity + non-current liabilities) × 100 30 of 35 what is the equation for payables days? (payables / cost of sales) X 365 31 of 35 what is the equation for capital employed? total equity + non-current liabilities 32 of 35 What is the equation for receivables days? (Receivables / Revenue) × 365 33 of 35 What is the equation for inventory turnover? Cost of sales / Average inventories held 34 of 35 What is the equation for average rate of return(%)? (Average annual return (£) / Initial cost of project (£)) × 100 35 of 35

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