Business Formulae 0.0 / 5 ? Business Studies & EconomicsFinanceA2/A-levelAll boards Created by: meg.gloverxCreated on: 14-10-19 11:15 Revenue (Sales or turnover) Selling price per unit x Number of units sold 1 of 34 Variable costs (Total variable costs) Variable cost per unit x Number of units sold 2 of 34 Total costs Fixed costs + Variable costs 3 of 34 Profit Total revenue - Total costs OR Total contribution - Fixed cocts 4 of 34 Market capitalisation of a business Number of issued shares x Current share price 5 of 34 Expected value of a decision with two possible outcomes (e.g A&B [Pay-off of A x probability of A] + [Pay-off of B x probability of B] A & B = [Pay-off of A x probability of A] + [Pay-off of B x probability of B] 6 of 34 Net gain Expected value - Initial cost of decision 7 of 34 Market growth (%) Change in the size of the market over a period / Original size of the market x 100 8 of 34 Market share (%) Sales of one product OR brand OR business / Total sales in the market x 100 9 of 34 Added value Sales revenue - costs of bought-in goods and services 10 of 34 Labour productivity Output over a time period/ Number of employees 11 of 34 Unit costs (Average costs) Total costs/ Number of units of output 12 of 34 Capacity utilisation (%) Actual output/ Maximum possible outcome x 100 13 of 34 Return on investment (%) Profit from the investment (£) / Cost of the investment (£) x 100 14 of 34 Gross profit Revenue - costs of sales 15 of 34 Profit from organisations Gross profit - operating profit 16 of 34 Profit for year Operating profit + profit from other activities - Net finance cost - Tax 17 of 34 Gross profit margin (%) Gross profit / Revenue x 100 18 of 34 Profit from operations margin Operating profit / revenue x 100 19 of 34 Variance Budgeted figure - actual figure 20 of 34 Contribution per unit Selling price - variable costs per unit 21 of 34 Total contribution Contribution per unit x units sold OR Total revenue - variable costs 22 of 34 Break-even output Fixed costs / contribution per unit 23 of 34 Margin of safety Actual output - break-even level of output 24 of 34 Labour turnover (%) Number of staff leaving / Number of staff employed by the business x 100 25 of 34 Employee rentention rate (%) for a particular time period Number of employees who remained with the business for the whole period of time / Number of employees at the start of the time period x 100 26 of 34 Labour cost per unit Labour costs / Units of output 27 of 34 Return on capital employed (ROCE) (%) Operating profit / Total equity + non-current liabilities x 100 Where total equity + non-current liabilities = capital employed 28 of 34 Current ratio Current assets/ Current liabilities 29 of 34 Gearing (%) Non-current liabilities / Total equity + non-current liabilities x 100 30 of 34 Payables days Payables / Cost of sales x 365 31 of 34 Receivables days Receivables / Revenue x 365 32 of 34 Inventory turnover Cost of sales / Average inventories held 33 of 34 Average rate of return (%) Average annual return (£) / Initial cost of project (£) x 100 34 of 34
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