important equations Flashcards
1
Q
total profit=
A
totals sales revenue- fixed costs- variable costs
2
Q
BEP
A
fixed costs/cm per unit
3
Q
how to work out depreciation per year
A
its inital money put in - residual / number of years
4
Q
average net income=
A
operating profit- depreciation
5
Q
average book value
A
initial money put in +residual
6
Q
when justifying response talk about…
A
cash flows
npv
pay back period- ignores time value of money
ARR considers depreciation
IRR considers timing of cash
