business finance

unit 3

net cash flow formula

total cash inflow - total cash outflow

closing balance formula

opening balance + net cash flow

total revenue formula

selling price x quantity sold

total costs formula

fixed costs + total variable costs

profit formula

total revenue - total costs

total contribution formula

sales revenue - total variable costs

contribution (per unit) formula

selling price - variable cost (per unit)

profit (using contribution) formula

contribution per unit x margin of safety

break-even output formula

total fixed costs / unit contribution

margin of safety formula

actual sales - break-even level of output

revenue formula

unit price x quantity sold

gross profit formula

sales revenue - cost of goods sold

cost of goods sold formula

opening inventory + purchases - closing inventory 

profit/loss for the year formula

gross profit - expenses + other income

net book value formula

cost - depreciation

net current assets formula

current assets - current liabilities

net assets formula

non-current assets + net current assets - long term liabilities

capital employed 

opening capital + profit for the year less drawings 

balance sheet formula

net assets = capital employed