Equations

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Market Capitalization.
= current share price x tot. no. of shares issued
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Market share.
% of sales in the total market sold by a business. = (tot. sales of bus. / tot. sales of industry) x 100 OR = (firm's sales in time period / tot. market sales in time period) x 100
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Equilibrium price.
demand = supply
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Mean.
Sum of all results / no. of results Ex: table - 2,3,5,7,2,6 Sum = 25 No. of results = 6 25 / 6 = 4.16
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Mode.
The value that occurs the most frequently ex: 2,3,6,2,5,7,9,2,3,1 In this case...the repetitive value is 2.
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Median.
1stly, always put the values in ascending (AO)/descending (DO) order! Ex: Odd No. of values given (put in AO) = (No. of values + 1) / 2 2,5,6,1,5,7,8,2,7,9,10,4,3,4,3 (15 values) --> 1,2,2,3,3,4,4,5,5,6,7,7,8,9,10 = (15+1) / 2 = 8 The median value i
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Price elasticity of demand (PED).
= % change in quantity demanded / % change in price. Ex: % Change in demand = 10 % Change in price = 25 PED = 10 / 25 = 0.4q
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Labor productivity.
Output per worker in a given time period. = Tot. output in time period (ex, 1 year) / Tot. staff employed.
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Absenteeism.
% of workforce absence as a portion of the employee total. = (No. of staff absent / Tot. no. of staff) x 100
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Labor turnover.
% of employees leaving the organization/business in a given time period.
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Income elasticity of demand.
The responsiveness of demand for a product followed by a change in consumer incomes. = % Change in demand for product / % Change in consumer incomes
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Promotional elasticity of demand.
The responsiveness of demand for a product followed by a change on spent amount promoting it. = % Change in demand for product / % Change in promotional spending
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Cross elasticity of demand.
The responsiveness of demand for a product followed by a change in the price of another product. = % Change in demand for product A / % Change in demand for product B
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Capacity utilization.
The rate of maximum output capacity being achieved. = (Current output lvl / max. output lvl) x 100
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Contribution per unit.
= Selling price (SP) - variable cost per unit
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Break-even lvl of output.
= Fixed costs / contribution per unit
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Unit Cost.
= Tot. cost of production / No. of units produced
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Sales revenue/sales turnover (SR/ST).
= Selling price x quantity sold
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Gross profit (GP).
= Sales revenue (SR) - cost of sales (CoS)
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Net profit (NP).
= GP - Overheads
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Pre-tax profits (Profit before tax).
= NP - Interest
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Profit after tax.
= Pre-tax profits - Tax
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Retained profits (RP).
= Profit after tax - Dividends.
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Gross profit margin.
= (GP / SR) x 100
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Net profit margin.
= (NP / SR) x 100
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Current ratio.
= Current assets / Current liabilities
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Liquid assets.
= Current assets - Inventories/Stocks
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Acid-test ratio.
= Liquid assets / Current liabilities
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Straight-line depreciation.
= (Original costs of assets - Expected residual value) / Expected useful life of asset (years)
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Capital employed.
= [(Non-current assets + current assets) - Current OR Non-current liabilities] + Shareholder's equity
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Return on capital employed (%)
= (NP or operation profit / Capital employed) x 100
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Inventory (stock) turnover ratio.
= CoG sold / Value of inventories
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Day's sales in receivables ratio.
= Accounts receivable x 365 / Revenue
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Dividend per share.
= Tot. annual dividends / Tot. No. of issued shares
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Dividend yield ratio (%).
Dividend per share x 100) / Current share price
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Dividend cover ratio.
= Profit after tax and interest / annual dividends
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Earnings per share.
= Profit after tax / Tot. No. of shares
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Price/Earnings ratio
= Current share price / Earnings per share
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Gearing ratio.
= (Long-term loans / Capital employed) x 100 OR = (Non-current liabilities x 100) / (Shareholder's equity + Non-current liabilities.
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Interest cover.
= Operating profit (Before tax & interest) / Paid annual interest
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Annual forecast net cash flow.
Forecast cash inflow - Forecast cash outflow
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Payback period.
= (Additional net cash inflow NEEDED / Annual cash flow in the 1st positive cash flow year) x 12 (for months) OR 365 (for days)
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Average rate of return (ARR).
= (Annual profit (Net cash flow) / Initial capital cost) * 100 There are 4 stages to calculate this...REMEMBER! 1. Add up all POSITIVE cash flows 2. Subtract INITIAL cost of investment 3. Divide it by lifespan 4. Multiply by 100 for %
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Discounted cash flow (DCF).
Multiply the expected cashflow by the discount factors and calculate the net cash flow if needed
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Net present value (NPV).
= [(Net cash flow x Discount factors) + Discounted cash flows] - Capital costs
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Internal rate of return (IRR)
Anything that exceeds cut off point/ Calculated by software
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Capital productivity
Output per unit of capital Output/ Capital Input
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Total Float
This is the total time an activity can be delayed without delaying Whole project completion. LFT-Duration-EST
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Free Float
The amount of time that a schedule activity can be delayed without delaying the early start date of any successor or violating a schedule constraint. EST(Next)-Duration(this)-EST(this)
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Margin of Safety
difference between your actual or expected profitability and the break even point (Current Sales- Break Even Quantity)/Current Sales
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net realizable value
Expected selling price (value) of an item minus the cost of making the sale.
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Inventory Turnover
cost of goods sold/average inventory
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Price Earnings Ratio
market price per share/earnings per share
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Other cards in this set

Card 2

Front

Market share.

Back

% of sales in the total market sold by a business. = (tot. sales of bus. / tot. sales of industry) x 100 OR = (firm's sales in time period / tot. market sales in time period) x 100

Card 3

Front

Equilibrium price.

Back

Preview of the front of card 3

Card 4

Front

Mean.

Back

Preview of the front of card 4

Card 5

Front

Mode.

Back

Preview of the front of card 5
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