Financial Analysis Concepts
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Questions and Answers

What is the formula to calculate the Net Cash Flow?

  • Total Cash Inflow - Total Cash Outflow (correct)
  • Total Cash Inflow + Total Cash Outflow
  • Total Cash Inflow / Total Cash Outflow
  • Total Cash Outflow - Total Cash Inflow
  • How do you calculate the Break-Even Output?

  • Total Fixed Costs / Unit Contribution (correct)
  • Total Revenue / Total Costs
  • Total Variable Costs / Selling Price
  • Selling Price / Quantity Sold
  • What does the Margin of Safety represent?

  • Break-Even Output - Actual Sales
  • Total Revenue - Total Costs
  • Projected Sales - Fixed Costs
  • Actual Sales - Break-Even Level of Output (correct)
  • What is the equation for calculating Gross Profit?

    <p>Sales Revenue - Cost of Goods Sold</p> Signup and view all the answers

    How is the Profit/Loss of the Year calculated?

    <p>Gross Profit + Other Income - Expenses</p> Signup and view all the answers

    Study Notes

    Cash Flow Forecasts

    • Net Cash Flow formula: Total Cash Inflow - Total cash outflow
    • Closing Balance formula: Opening Balance + Net cash Flow

    Break-Even Analysis

    • Total Revenue formula: Selling Price X Quantity Sold
    • Total Costs formula: Fixed Cost + Total Variable Costs
    • Total Contribution formula: Sales Revenue - Total Variable Costs
    • Contribution (Per Unit) formula: Selling Price - Variable Costs
    • 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
    • Profit formula: Total Revenue - Total Costs

    Statement of Comprehensive Income

    • 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 of the Year formula: Gross Profit - Expenses + Other Income
    • Net Book Value formula: Cost - Depreciation

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    Description

    This quiz covers essential financial analysis concepts including cash flow forecasts, break-even analysis, and comprehensive income statements. Test your knowledge of various financial formulas and their applications in real-world scenarios.

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