Business formulae

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What is the formula for total costs?
TC= TFC (total fixed costs) +TVC (total variable costs)
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How do you work out Variable costs?
VC = cost of 1 unit X amount produced
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How do you work out revenue?
Revenue = price X quantity
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What is the formula for break-even?
Break-even point in units = fixed costs/(sales price - variable costs)
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How do you work out the margin of safety?
Margin of safety = actual or budgeted sales - break-even sales
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How do you work out the interest on a loan?
Interest in % = (total repayment - borrowed amount)/borrowed amount (X100)
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What is the formula for net cash flow?
Next cash flow = inflows - outflows
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How do you find the opening balance?
Opening balance = closing balance of the previous period
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How do you find the closing balance?
Closing balance = opening balance + net cash flow
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How do you find the profit/loss of a business?
Profit/loss = total revenue - total costs
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What is the formula for gross profit?
Gross profit = sales revenue - cost of sales
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What is the formula for the gross profit margin?
Gross profit margin % = gross profit/sales revenue (X100)
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How do you work out net profit?
Net profit = gross profit - other operating expenses and interest
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What is the formula for the net profit margin?
Net profit margin % = net profit/sales revenue (X100)
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How do you work out the average rate of return?
Average rate of return % = average annual profit (Total profit/number of years)/cost of investment (X100)
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How do you work out the percentage growth?
Percentage growth = increase in size/original size (X100)
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Other cards in this set

Card 2

Front

How do you work out Variable costs?

Back

VC = cost of 1 unit X amount produced

Card 3

Front

How do you work out revenue?

Back

Preview of the front of card 3

Card 4

Front

What is the formula for break-even?

Back

Preview of the front of card 4

Card 5

Front

How do you work out the margin of safety?

Back

Preview of the front of card 5
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