Formulaes

Question 1

Payable days

Answer 1

Trade payables/ cost of sales x365

Question 2

Net profit

Answer 2

Gross profit-Expenses and taxes

Question 3

Gross profit

Answer 3

Revenue - Cost of good sold

Question 4

Receivable days

Answer 4

Trade receivables/ revenue(sales) x365

Question 5

Gearing

Answer 5

Non current liabilities/ Total equity+non current liabilities

Question 6

ROCE

Answer 6

Operating profit (net profit)/ Total equity + non current liabilities

Question 7

Average annual profit

Answer 7

Total annual profit/years

Question 8

Average Rate of Return (ARR)

Answer 8

Average annual profit/investment

Question 9

Present value

Answer 9

Cash flow X discount factor

Question 10

Current ratio

Answer 10

Current assets/current liabilities

Question 11

3 examples of assests

Answer 11

Cash, inventory and debtors

Question 12

Examples of liabilities

Answer 12

Creditors and overdrafts

Question 13

Working capital (Net current assets)

Answer 13

Current assets - Current liabilities

Question 14

Capital employed

Answer 14

Total equity + non current liabilities

Question 15

Inventory turnover

Answer 15

Cost of sales/ inventories

Question 16

Earnings per share

Answer 16

Profit for the period/ Number of sales