# Formulas?? (1 Viewer)

#### sk8ie_boi

##### peaker
So what are all the formulas we need to know?

Current ratio = current assets / current liabilities
Gearing ratio = lorg-term debt / sharholder's equity
Gross profit = gross profit / sales
Net profit margin = net profit / sales
Return on owner's equity = net profit / owner's equity
Expense ratio = operating expenses / net sales
Accounts receivalbe trunover ratio = accounts receivable / average sales per day

Working Capital = Current assets - Current Liabilities

So, what other formulas do we need to know? What about the formula for COGS?? .. I can't remember dat one.

#### Jexi

##### Member
There is a formula for COGS? Isn't just purchases + freight ect ect?

oh the accounting equation? A = L + OE

#### sk8ie_boi

##### peaker
Jexi said:
There is a formula for COGS? Isn't just purchases + freight ect ect?

oh the accounting equation? A = L + OE
COGS is got to do wif umm sales, expenses and sumthing else .. we did it in year 11 .. but i forgot the formula for it .. and i fink we need it since the hsc mite ask u a question which u need COGS

#### exa_boi87

##### aka biomic
COGS = Cost of Goods Sold, meaning the incurred expenses through manufacturing the final product (includes raw materials and production costs).
Net Profit is generally defined as Gross Profit - COGS, they *may* ask this .. but my bets on the syllabus ratios.

#### ~SeXcSuM~

##### Member
Gross Profit = Revenue - COGS

so, COGS = Revenue - Gross Profit

?

#### MeehShanku

##### MeehShankU
just a question about the gearing ratio=Long term debt/owners equity. Long term is = to non current liabilities right?

Edit: as well is gross profit ratio the measurement of profit before tax and net profit ration after tax??

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#### ~SeXcSuM~

##### Member
MeehShanku said:
just a question about the gearing ratio=Long term debt/owners equity. Long term is = to non current liabilities right?

Edit: as well is gross profit ratio the measurement of profit before tax and net profit ration after tax??

Gearing is:
TOTAL liabilities/Owners equity

so im thinkin its both long and short term liabilities

#### rach_1

##### New Member
Working Capital Ratio

How do you figure out working capital ratio?
I know working capital is current assets - current liabilities... im just not sure bout ratio??

#### MeehShanku

##### MeehShankU
~SeXcSuM~ said:
Gearing is:
TOTAL liabilities/Owners equity

so im thinkin its both long and short term liabilities
aight kool.

rach_1 said:
How do you figure out working capital ratio?
I know working capital is current assets - current liabilities... im just not sure bout ratio??
working capital ratio = Current ratio

#### going_under

##### New Member
rach_1 said:
How do you figure out working capital ratio?
I know working capital is current assets - current liabilities... im just not sure bout ratio??
working capital = current assets - current liabilities

working capital RATIO = current assets / current liabilities

#### Jexi

##### Member
exa_boi87 said:
Net Profit is generally defined as Gross Profit - COGS, they *may* ask this .. but my bets on the syllabus ratios.
No its not.

Sales - COGS = Gross Profit

Gross Profit - Expenses = Net Profit.

#### MarsBarz

##### Member
COGS = Opening stock + purchases - closing stock