I used MaLoTu's link when I was starting and then customized it. This list that I am going to post is only from formulas that I was having trouble working. Like MaLoTu said there are a lot more formulas in BEC.
CASH MANAGEMENT
Benefit per check in lockbox
Benefit per check cleared = (D)(S)(i)
D = days saved in the collection process
S = average check size
i = daily interest rate or opportunity cost. For example (5% ÷ 360 = .0139%)
EXAMPLE: Cost per check cleared = 1.2 days × $1,000 × .0139% = $0.17 per check cleared
Assuming that the cost of the service would be $.20 per check cleared, the Company should not adopt this alternative.
Total benefit in dollars from minimizing float
Per check amount * days of float reduced * Annual rate of interest
Breakeven in dollars for checks received
Fee amount per check / Per day Interest * per day added
INVENTORY MANAGEMENT
EOQ = SQUARE ROOT of (2 x D (demand for year) x S (cost order) / C (cost per unit) x i (carrying cost expressed as a % of inventory)
Reorder Point= avg purchase lead time* daily demand + safety stock
Safety Stock= (Max LT – Avg lead time) * daily usage
Inventory conversion period = Average Inventory / Cost of sales per day
= # of days in year (usually 365 or 360) / Inventory Turnover
A/R MANAGEMENT
Average collection period:
365 ÷ AR Turnover, or
365 ÷ (Net Credit Sales ÷ Average AR), or
Average AR ÷ Average Daily Sales, or
Average AR ÷ (Net Credit Sales ÷ 365).
AR turnover = Net Sales / Average account receivable
Average day sales = Net credit sales / 365
Factoring = % of interest is applied to amount advanced. Only the fees have to be annualized if given an average of monthly receivables amount. Cost of fees + interest are subtracted against the annual savings in managing the receivables to get the net cost.
INTEREST CALCULATIONS
APR (annual percentage return) = Effective Interest Rate * # of periods in year
Effective Interest Rate = (principle * rate * time) / principle
Times interest Earned Ratio = earnings BEFORE interest and taxes / interest expense
MANAGING PAYABLES
TARDE COST = (360/ charged period) x (discount % / discounted principal %)
CVP ANALYSIS (COST, VOLUME, PROFIT)
Current unit sales = Total sales / Sales price per unit
Contribution Margin Ratio = (sales – variable costs) / sales
Breakeven Point in terms of units = fixed costs / Contribution Margin per unit
Breakeven Point in terms of dollars sales = fixed costs / contribution margin ratio
At Breakeven Point CM= Total Fixed Costs
Margin of safety = Total sales – Breakeven
Projected NI at certain amount of sales = (Sales – Fixed cost) * CM per unit
Unit sales needed to get a certain NI = (Fixed cost + NI) / CM per unit
or Fixed costs / CM % – (% of desired return)
VARIANCES
• Labor Efficiency – SR * (SH – AH).
• Labor Rate – AH * (SR – AR) AH = Actual total labor cost / Actual labor rate per hour
• Material Price – AQ * (SP – AP)
• Material Efficiency – SP * (SQ – AQ)
• Fixed overhead spending – (budgeted-standard fixed overhead to incur – actual fixed overhead incurred)
• Fixed overhead volume – (budgeted-standard fixed overhead to incur – ((actual production * standard labor hours)*(budgeted-standard fixed overhead to incur/budgeted labor hours))
COST OF EQUITY
CAPM
Cost of equity =Risk free rate + beta (LT average risk premium – Risk free rate)
Beta = change in stock value/change in market value
DIVIDEND PRICE MODEL
Cost of equity = (D / (P (1-F) )) + g
RESIDUAL INCOME
RESIDUAL INCOME (RI) = operating profit – invested capital * required rate of return (or interest on investment)
It can be divided into two elements:
Profit margin = Operating income ÷ Sales
Invested capital turnover = Sales ÷ Average invested capital
ROI
NI / Capital Investment or
Capital Turnover * Return on sales
EVA
Economic Value Added = net operating profit after taxes (NOPAT) – cost of financing
REGRESION ANALYSIS
Least square method y (dep var)= a(intercept or fixed cost) + b(slope of line or variable per unit) x(ind variable)
Coefficient of determination R2 (square) measures the extent of change to which the ind variable explains the change in the dependent one. R2 closest to 1 is the better one.
TQM MEASUREMENTS
Manufacturing Cycle = Manufacturing or Process Time /
Efficiency Time from Start of Manufacturing to Delivery
ECONOMIC MEASURMENTS
ELASTICITY
Percentage change in quantity demanded
E = —————————————-
Percentage change in price
Or, Change in quantity/Average quantity
————————————-
Change in price/Average price
Or, (Original quantity – New quantity)/((Original + New)/2)
. ———————————————————
(Original price – New price)/((Original + New)/2)
Cross-Elasticity = % change in demand for certain product A / % change in price of certain product
Income Elasticity = % change in quantity demanded / % change in income
Marginal utility = change in total utility / change in quantity
Marginal propensity to consume = change in spending / change in disposable income
Marginal propensity to save = change in savings / change in income
Multiplier effect = 1/MPS (or 1-MPC)
Forward Contract Premium or discount
Forward rate – Spot rate / spot rate * (12 / months left to arrive at forward)
RATIOS
Economic Rate of return on C/S = [Dividends received + (Ending price – Beginning price or change in price)] ÷ Beginning price
Reward risk ratio = Investment return / measure of risk (sometimes the standard deviation)
Dividend Payout Ratio = cash dividend per share / Earnings per share
Market/Book Ratio = common stock price per share (or market value)/ book value per share
Price/Earning (PE) Ratio = common stock price per share / Earning per share
Price/Earnings to Growth (PEG) = P/E / Annual EPS Growth
.