Compiled by two00five on reddit
- Revenue : Quantity sold x Price
- Productivity : Output / Quantity of input
- Labor Productivity : Output / Number of employees
- Working Capital : Current Assets – Current Liabilities
- Capital Employed ( or Share holder’s funds ): Total Assets – Total Liabilities
- Profit : Revenue – Cost of sales
- Profit ( from Break even graph ) : Total Revenue – Total Costs or TR – TA
- Total Costs : Fixed Costs + Variable Costs or FC + VC
- Average Cost : Total Costs / Total Number of units produced
- Break even point : Fixed costs / Contribution per unit or FC / ( SP – VC )
- Contribution per unit : Selling price – Variable costs
- Margin of safety : Maximum output – Break even output
- Gross profit : Revenue – Cost of sales ( or Variable costs )
- Gross profit margin : Gross profit / Revenue x 100
- Net profit : Gross profit – Expenses ( or Fixed costs )
- Net profit margin : Net profit / Revenue x 100
- Return on Capital Employed : Net profit / Capital Invested x 100
- Current ratio : Current Assets / Current liabilities
Safest ratio is 2:1 or 3:1 - Acid Test Ratio ( or Quick Ratio ) : Current Assets – Inventory ( or Stock ) / Current Liabilities
Safest ratio is 1.5:1
Remember to give all ratio answers in 2 decimal places without rounding
