Business Calculations

Question 1

Total costs calculation

Answer 1

Fixed costs + variable costs

Question 2

Unit costs calculation

Answer 2

Total costs / output

Question 3

Average revenue calculations

Answer 3

Total revenue / number of sales

Question 4

Contribution per unit calculation

Answer 4

Price - variable costs

Question 5

Profit calculation

Answer 5

Total contribution - fixed costs

Question 6

Contribution calculation

Answer 6

Revenue - variable costs

Question 7

Break even calculation

Answer 7

Fixed costs / contribution per unit

Question 8

Margin of safety calculation

Answer 8

Actual output - break even level of output

Question 9

Gross profit calculation

Answer 9

Sales revenue - cost of sales

Question 10

Operating profit calculation

Answer 10

Gross profit - expenses

Question 11

Profit before tax calculation

Answer 11

Operating profit - finance costs

Question 12

Profit for the year calculation

Answer 12

Net profit - tax and dividends

Question 13

Depreciation straight line method

Answer 13

Initial cost - (residual value / life of the asset)

Question 14

Depreciation reducing balance method

Answer 14

Value after depreciation - depreciation rate that year

Question 15

Current ratio

Answer 15

Current assets / current liabilities

Question 16

Acid test ratio

Answer 16

(Current assets - stock) / current liabilities

Question 17

Gearing ratio

Answer 17

(Non current liabilities / capital employed) x 100

Question 18

Debt to equity

Answer 18

(debt / equity) x 100

Question 19

Interest cover

Answer 19

Operating profit / interest payable

Question 20

Non current assets turnover

Answer 20

Revenue / non current assets

Question 21

Stock turnover

Answer 21

Costs of stock / average stock

Question 22

Debtor days

Answer 22

(Trade receivables / revenue) x365

Question 23

Creditor days

Answer 23

(trade payables / purchases) x365

Question 24

Gross profit margin

Answer 24

(Gross profit / sales) x100

Question 25

Net profit margin

Answer 25

(net profit / sales) x 100

Question 26

Return on capital employed

Answer 26

(Operating profit / capital employed) x100

Question 27

Return on equity

Answer 27

Profit for the year / shareholders equity

Question 28

Dividend per share

Answer 28

Total dividends paid / number of shares issues

Question 29

Dividend yield

Answer 29

(dividend per share / market price of share) x 100

Question 30

Earnings per share

Answer 30

Profit for the year / number of shares issued

Question 31

Price earnings ratio

Answer 31

Market price of share / earning price of share

Question 32

Standard deviation

Answer 32

``` (Answer - mean) for all results Then add up all of the results Square that number Divide it by number of data collected Square root that figure ```

Question 33

Labour turnover

Answer 33

(Number of employees leaving during the year / average number employed during the year) x100

Question 34

Absenteeism

Answer 34

(total days absent in the month x100) / total available working days

Question 35

Lateness

Answer 35

(Total number of late arrivals x 100) / total number of scheduled attendances

Question 36

Workforce productivity

Answer 36

Output / average number of employees

Question 37

Income elasticity of demand

Answer 37

Percentage change in demand / percentage change in income

Question 38

Advertising elasticity of demand

Answer 38

Percentage change in demand / percentage change in advertising spending

Question 39

Cross elasticity of demand

Answer 39

Percentage change in product A (demand) / percentage change in product B (demand)

Question 40

Total float

Answer 40

Latest finishing time - duration - estimated start time

Question 41

Free float

Answer 41

Estimated start time of next activity - duration of activity - estimated start time of activity before

Question 42

Productivity

Answer 42

Output / input Number of goods produced / number of employees Sales revenue / non current assets Sales revenue / wage bill or number of employees

Question 43

Capacity utilisation

Answer 43

(Actual or current level of output / maximum possible output) x 100

Question 44

Average stock

Answer 44

(Maximum stock + minimum stock) / 2

Question 45

Wastage rates

Answer 45

(Number of rejects produced / total number of products produced) x 100