business equations theme 2 Flashcards
net cash flow equation
total inflows - total outflows
sales volume equation
total number of units sold over a period of time
sales revenue equation
number of units sold x unit price
total variable costs equation
number of units sold x variable cost per unit
total costs equation
fixed costs + variable costs
contribution per unit equation
selling price per unit - variable cost per unit
total contribution equation
contribution per unit x number of units sold
break even equation
fixed costs / contribution per unit
variance equation
actual - budget
gross profit equation
sales revenue - cost of sales
operating profit equation
gross profit - overheads
net profit equation
operating profit + or - finance costs
gross profit margin equation
(gross profit / sales revenue) x 100
operating profit margin
(operating profit / sales revenue) x 100
profit for the year (net profit) margin equation
(profit for the year / sales revenue) x 100
