Business Formulas 0.0 / 5 ? Business StudiesFinancial PlanningA2/A-levelAQA Created by: Beanie10Created on: 12-10-19 14:06 Revenue selling price per unit x number of units sold 1 of 37 Total variable costs variable costs per unit x number of units sold 2 of 37 Total costs fixed costs + variable costs 3 of 37 Profit formulas - total revenue - total costs or -total contribution - fixed costs 4 of 37 Market capitalisation of a business number of issues x current share prices 5 of 37 expected value of a decision with 2 possible outcomes [pay-off of A x probability of A] + [pay-off of B x probability of B] 6 of 37 Net gain expected value - initial cost of decision 7 of 37 Market growth (%) change i the size of a market over a period / original size of the market x 100 8 of 37 Market share (%) sales of one product or brand or business / total sales in the market x 100 9 of 37 Added value sales revenue - costs of bought- in goods and services 10 of 37 Labour productivity output over a time period / number of employees 11 of 37 Unit costs total costs / number of units of output 12 of 37 Capacity utilisation (%) actual output / maximum possible output x 100 13 of 37 Return on investment (%) profit from the investment (£) / cost of the investment (£) x100 14 of 37 Gross profit revenue - cost of sales 15 of 37 Operating profit Gross profit - operating expenses 16 of 37 Gross profit margin (%) gross profit/ revenue x 100 17 of 37 Operating profit margin (%) operating profit / revenue x 100 18 of 37 Profit for the year margin (%) profit for the year / revenue x 100 19 of 37 Variance budgeted figure - actual figure 20 of 37 Contribution per unit selling price - variable costs per unit 21 of 37 Total contribution formulas -contribution per unit x units sold or -total revenue - total variable costs 22 of 37 Break-even output fixed costs / contribution per unit 23 of 37 Margin of safety actual level of output - break-even level of output 24 of 37 Labour turnover (%) number of staff leaving / number of staff employed by the business x 100 25 of 37 \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 26 of 37 Employee costs as percentage of turnover employee costs / turnover x 100 27 of 37 Labour cost per unit labour costs / units of output 28 of 37 Return on capital employed (ROCE) (%) operating profit / (total equity + non-current liabilities) x 100 29 of 37 Capital employed total equity + non-current liabilities 30 of 37 Current ratio current assets / current liabilities 31 of 37 Gearing (%) non-current liabilities / (total equity + non-current liabilities) x 100 32 of 37 Payables days payables / cost of sales x 365 33 of 37 Receivables days receivables / revenue x 365 34 of 37 Inventory turnover cost of sales / average inventories held 35 of 37 Average rate of return (%) average annual return (£) / initial cost of project (£) x 100 36 of 37 Average rate of return (%) average annual return (£) / initial cost of project (£) x 100 37 of 37
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