Monday, 24 December 2012

Higher Business Management - Ratio Formulae

Here are some Ratio formulae. I’ll look into what each of them mean in more detail over the Christmas holidays. Enjoy!

Gross Profit percentage
Gross Profit      x  100
Sales (Turnover)     1

Net Profit percentage
Net Profit         x  100
Sales (Turnover)     1

Profit Mark-Up
Gross Profit            x 100
Cost of Goods Sold      1

Return on Capital Employed
Net Profit before
interest & tax        x 100
Capital Employed         1

Current Ratio
Current Assets
Current Liabilities

Acid Test Ratio
Current Assets - Stock
Current Liabilities

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