Final Exam Ratio or Concept Accounting.docx

Final Exam Ratio or Concept Accounting.docx - Ratio or...

Info icon This preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
Ratio or Concept Formula Predetermined Overhead Rate Estimated Total Manufacturing Overhead Costs ÷ Estimated Total Units of Cost Driver Hi-Lo Method (Cost Associated with High Level of Activity - Cost Associated with Low Level of Activity) ÷ (High level of Activity - Low Level of Activity) Contribution Margin and Ratio Sales – Variable Costs = Contribution Margin Contribution Margin ÷ Sales = Contribution Margin Ratio Breakeven Fixed Costs ÷ Contribution Margin = Breakeven Target Profit (Fixed Costs + Target Profit) ÷ Contribution Margin = Target Profit ROI Net Operating Income ÷ Average Operating Assets or Margin × Turnover Margin Net Operating Income ÷ Sales Turnover Sales ÷ Average Operating Assets Simple Rate of Return Annual incremental net operating income ÷ initial investment Payback Period Investment Required ÷ Net Annual Cash Inflow Residual Income Net Operating Income - (Average Operating Assets × Minimum Required Rate of Return NPV PV of Cash Inflows - PV of Cash Outflows
Image of page 1
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern