Studied by 11 peopleTotal costs
Fixed costs + Variable costs
Profit
Total Revenue - Total Costs OR
Total contribution - Fixed costs
Variable costs (Total variable costs)
Variable cost per unit x Number of units sold
Total revenue (Sales revenue or Turnover)
Selling price per unit x Number of units sold
Market capitalisation
Number of issued shares x Current share price
Net gain (decision tree)
Expected value - Initial cost of decision
Market size (volume)
The quantity of goods and services produced in a particular market over a period of time (usually one year)
Sales volume
The quantity of goods and services produced by a particular business over a period of time (usually one year)
Sales value
The total sales revenue of a particular business over a period of time (usually one year)
Percentage Change
New - Old / Old x 100
Market growth % in year X
Change in size of the market between year (X-1) and year X / Size of the market in year (X-1)
Sales growth % in year X
Change in sales of product or business between year (X-1) and year X / Sales of product or business in year (X-1)
Market size (value)
The total sales revenue generated from selling all of the goods and services produced in a particular market over a period of time (usually one year)
Market share %
Sales of one product OR brand OR business / Total sales in the market x 100
Price elasticity of demand
Percentage change in quantity demand / Percentage change in price
Price inelastic demand
PED coefficient in the range 0 to -1
Price elastic demand
PED coefficient in the range -1 to - infinity
Added value (value added)
Sales revenue - costs of bought in goods and services
Labour productivity
Output per time period / Number of employees
Unit costs (average costs)
Total costs of production / Number of employees
Capacity utilisation %
Actual output in a given time period / Maximum possible output in a given time period x 100
Return on Investment %
Return on investment £ / Cost of investment £ x 100
Gross profit
Sales revenue - Cost of sales
Operating profit (profit from operations)
Gross Profit - Operating expenses
Profit for the year
Operating profit + Profit from other activities - Net finance costs - Tax
Variance
The difference between the actual and a budgeted figure
Favourable variance (F)
Income or expenditure or profit being higher (better) than forecast (budget)
Adverse variance (A)
Income or expenditure or profit being lower (worse) than forecast (budget)
Contribution per unit
Selling price - Variable costs per unit
Total contribution
Contribution per unit x Units produced
Breakeven output
Fixed costs / Contribution per unit x 100
Breakeven output
Level of output at which Total revenue = Total costs (on a break even chart)
Margin of safety
Actual level of output - Breakeven level of ouput
Gross Profit Margin %
Gross Profit / Sales Revenue x 100
Operating Profit Margin %
Operating Profit / Sales Revenue x 100
Profit for year margin %
Profit for year / Sales revenue x 100
Labour turnover %
Number of staff leaving during the year / Average number of staff employed by the business during the year x 100
Employee retention rate %
Number of employees employed for one year or more / Average number of staff x 100
Labour cost per unit
Labour costs / Units of output
Note
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