formulas

Question 1

revenue

Answer 1

price X quantity

Question 2

total costs

Answer 2

fixed costs + total variable costs

Question 3

unit cost per unit

Answer 3

total cost / output

Question 4

variable cost per unit

Answer 4

total variable cost / quantity

Question 5

profit

Answer 5

revenue - total costs

Question 6

gross profit

Answer 6

revenue - variable costs

Question 7

net profit

Answer 7

revenue - total costs

OR

gross profit - other expenses

Question 8

profit for the year

Answer 8

all income - all expenditures

Question 9

gross profit margin

Answer 9

gross profit / revenue X 100

Question 10

net profit/operating margin

Answer 10

net profit / revenue X 100

Question 11

profit for the year margin

Answer 11

profit for the year / revenue X 100

Question 12

return on investment

Answer 12

net profit / capital invested X 100

Question 13

gearing

Answer 13

long term loans / capital employed X 100

Question 14

market capitalisation

Answer 14

share price X number of issued shares

Question 15

contribution per unit

Answer 15

selling price per unit - unit variable costs

Question 16

total contribution

Answer 16

contribution per unit X number of items sold

Question 17

profit made from total contribution

Answer 17

total contribution - fixed costs

Question 18

breakeven level of output

Answer 18

fixed costs / contribution per unit

Question 19

margin of safety

Answer 19

actual level of output - breakeven point

Question 20

capacity utilisation

Answer 20

current output / maximum output X 100

Question 21

labour productivity

Answer 21

total output / the number of workers

Question 22

labour cost per unit

Answer 22

total labour costs / output

Question 23

labour cost as a percentage of revenue

Answer 23

labour cost / revenue X 100

Question 24

labour turnover

Answer 24

number of staff leaving per year / average number of staff employed in a year X 100

Question 25

labour retention

Answer 25

number of staff employed for a year or more / average number of staff employed in a year X 100

Question 26

market share by volume

Answer 26

the total number of units sold in a market

Question 27

market size by value

Answer 27

the number of units X sold by price

Question 28

market share

Answer 28

sales of firm A / total market size X 100

Question 29

market growth

Answer 29

change in market size / old market size X 100

Question 30

percentage change in demand

Answer 30

percentage change in price X PED

Question 31

percentage change in demand

Answer 31

percentage change in income X YED

Question 32

percentage change

Answer 32

new - original = difference difference / original X 100

Question 33

labour productivity

Answer 33

output per year ---------------- no of employees per period = units of output per worker

Question 34

labour turnover

Answer 34

no of staff leaving per year ---------------------- average no of staff X 100 = % of workers who left per year

Question 35

retention rates

Answer 35

no of employees employed for a year or more ----------------------- average no of staff X 100 = employee retention

Question 36

employee costs as a % of turnover

Answer 36

employee/labour costs ------------------------- sales turnover/revenue X 100

Question 37

labour cost per unit

Answer 37

total labour costs ------------------ total units of output X 100

Question 38

labour productivity

Answer 38

output per year ---------------- number of employees = units of output per worker

Question 39

unit costs

Answer 39

total costs ----------- units of output

Question 40

capacity utilisation

Answer 40

actual output per year ----------------------- maximum possible output per year X 100