Formulae

Question 1

Unit costs

Answer 1

Total costs divided by Output

Question 2

Market share

Answer 2

Sales of product divided by Total market sales multiplied by 100

Question 3

Revenue

Answer 3

Price of product multiplied by Quantity sold

Question 4

Profit

Answer 4

Revenue subtract Total costs

Question 5

Total costs

Answer 5

Fixed costs add Variable costs

Question 6

Variable costs

Answer 6

Variable cost of a single unit multiplied by Number of units

Question 7

Percentage change

Answer 7

Change divided by Original multiplied by 100

Question 8

Market growth

Answer 8

Change in market size divided by Original market size multiplied by 100

Question 9

Total cash inflow/outflow

Answer 9

Add inflows/outflows

Question 10

Net cash flow

Answer 10

Cash inflow minus Cash outflow

Question 11

Opening balance

Answer 11

Closing balance of the previous month

Question 12

Annual rate of return (ARR)

Answer 12

1. Calculate average yearly profit (=Total profits divided by Number of years)
2. Average yearly profit divided by Cost of investment project multiplied by 100

Question 13

Closing balance

Answer 13

Opening balance add Net cash flow

Question 14

Margin of safety

Answer 14

Actual output subtract Break even output

Question 15

Gross profit

Answer 15

Revenue subtract Cost of sales

Question 16

Net profit

Answer 16

Gross profit subtract Expenses

Question 17

Operating profit

Answer 17

Net profit subtract Tax and interest

Question 18

Net assets

Answer 18

Fixed assets add Current assets subtract Current liabilities subtract Long term liabilities

Question 19

Gross profit margin

Answer 19

Gross profit divided by Revenue multiplied by 100

Question 20

Net profit margin

Answer 20

Net profit divided by Revenue multiplied 100