Level 3 Advanced Bookkeeping Formulas

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What is the accounting formula?
Assets - liabilities = equity + profit
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What is the formula for profit?
Income - expenses = profit
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What is the formula for net worth?
Equity + profit = net worth
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What is the formula for net assets?
Non current assets + net current assets - non current liabilities = net assets
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What is the formula for straight line depreciation?
Cost - residual value / useful economic life
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What is the formula for net book value?
Cost - depreciation charged to date
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How do you know if you have a profit on disposal?
Proceeds > net book value
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How do you know if you have a loss on disposal?
Proceeds < net book value
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What is the formula for cost of sales?
Opening inventory + purchases - closing inventory
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How to you know if your VAT is payable to HMRC?
Output VAT > input VAT
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How do you know if VAT is reclaimable from HMRC?
Input VAT < output VAT
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What is the formula for units of depreciation?
Cost / amount made x units in a year
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Other cards in this set

Card 2

Front

What is the formula for profit?

Back

Income - expenses = profit

Card 3

Front

What is the formula for net worth?

Back

Preview of the front of card 3

Card 4

Front

What is the formula for net assets?

Back

Preview of the front of card 4

Card 5

Front

What is the formula for straight line depreciation?

Back

Preview of the front of card 5
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