Formulas

Question 1

Formula for CM

Answer 1

Sales - Vc

Question 2

Formula for CMU

Answer 2

SP-VC per unit
or
Total CM / units sold

Question 3

Formula for CMR

Answer 3

CMU / SP
CM / sales $

Question 4

Formula for Break-even analysis

Answer 4

BEU = FC/CMU
BE$= FC/CMR

Question 5

Target sales (before taxes)

Answer 5

TS = VC+FC+target NIB4T

Question 6

Formula for TSU & TS$ Before tax

Answer 6

(FC + NIB4T) / CMU
(FC + NIB4T) / CMR

Question 7

Formula for Margin of safety in $

Answer 7

Actual Sales - BE$

Question 8

Formula for Margin of safety in units

Answer 8

MS$ / SP

Question 9

Formula for Margin of safety in ratio

Answer 9

MSR= MS$/actual/expected sales

Question 10

How do you calculate the weighted average contribution margin (WACMU) or WACMR

Answer 10

(CMU1 x SM1) + (CMU2 x SM2)
(CMR1 x SM1) + (CMR2 x SM2)

Question 11

Target sales (after taxes)

Answer 11

TSU = (FC + NIB4T) / WACMU
TS$ = (FC + NIB4T) / WACMR

Question 12

Operating leverage

Answer 12

DOL=CM/OI
change in OL= DOL%change in saleSales$

Question 12

what is the format for Special orders

Answer 12

Sales
-VC:
DM
DL
VOH
=CM
-OC
=Profit

Question 13

what is the format for Make or Buy Cost

Answer 13

DM
+DL
+VOH
+FOH
+PP
+OC
=TC

Question 14

what is the format for Make or Buy Revenue

Answer 14

Sales
-DM
-DL
-VOH
-FOH
-PP
-OC
=PROFIT

Question 15

what is the format for sell or process further

Answer 15

Sales per unit
-cost per unit
DM
DL
VOH
FOH
Total cost
=NI per unit

Question 16

what is the format for Keep or replace cost

Answer 16

Annual cost
*useful life
=total operating cost
+pp
-salvage value
=total cost

Question 17

what is the format for Keep or replace revenue

Answer 17

sales
-cost
=yearly profit
x useful life
=Total profit
-PP
+SV
=Total

Question 18

what is the format to eliminate unprofitable segments

Answer 18

Sales
-vc
=CM
-Fc
=OI

Question 19

what is the format to allocate limited resources

Answer 19

Sp
- VC per unit
=CMU
/machine hours per unit
=CM per machine hours

Question 20

Build the COGS chart for Absorption, Variable and throughput

Answer 20

DM
DL
VOH
FOH
=COGS

Question 21

Find End FG (allocate units inventory)

Answer 21

Beg FG
+units produced (COGM)
-Units sold (COGS)
=End FG

Question 22

Make the income statement for absorption

Answer 22

Sales
-COGS
=GP
-VSE
-FSE
=NI

Question 23

Make the income statement for Variable

Answer 23

Sales
- V COGS
-VSE
=CM
-FOH
-FSE
=NI

Question 24

Make the income statement for Throughput

Answer 24

Sales -T COGS =T CM -DL -VOH -FOH -VSE -FSE =NI

Question 25

Template for reconciliation

Answer 25

NI (most left) +Beg FG (units in Beg FG * change in COGS per unit) -End FG (units in end * change in COGS per unit)

Question 26

what is the total cost per unit for 1. Total cost 2. Absorption 3. Variable

Answer 26

1. DM+DL+VOH+VSE+FOH+FSE 2. DM+DL+VOH+FOH 3. DM+DL+VOH+VSE

Question 27

Formula for SP for 1. total cost 2. Absorption 3. Variable

Answer 27

1. Total cost per unit + ( Markup % * total cost per unit) Manufacturing cost per unit + ( Markup % * MC cost per unit)

Question 28

Formula for markup % for 1. Total cost 2. Absorption 3. Variable

Answer 28

1. Desired ROI per unit/Total cost 2. (Desired ROI + VSE per unit + FSE per unit)/MC per unit 3. Desired roi + FSE per unit + FHO per unit/vc per unit

Question 29

Formula Desired ROI

Answer 29

($ invested * ROI %)/units produced

Question 30

what is the composes the VC

Answer 30

DM+DL+VSE+VOH

Question 31

how do you calculate MIN TP

Answer 31

VC + OC

Question 32

How do you get OC

Answer 32

(sp ext - VC ext)/units transferred * units given