Business Mathematics Formulas
Some of the Basic Formulas related to Business mathematics are as follows:
|
Formula Name |
Formula |
|---|---|
|
Profit |
Profit = Selling Price – Cost Price |
|
Loss |
Loss = Cost Price – Selling Price |
|
Simple Interest |
SI = P × R × T |
|
Compound Interest |
A = P × (1 + r/n)(n*t) |
|
Net Income |
Net Income = Revenue – Expenses |
|
Accounting Equation |
Assets = Liabilities + Equity |
|
Cost of Goods Sold (COGS) |
COGS = Beginning Inventory + Purchases – Ending Inventory |
|
Break-Even Point |
Break-Even Point = Fixed Cost / (Selling Price per unit – Variable Cost per unit) |
|
Current Ratio |
Current Ratio = Current Assets / Current Liabilities |
|
Profit Margin |
Profit Margin = (Net Income / Revenue) × 100 |
|
Return on Investment (ROI) |
ROI = [(Investment Gain – Cost of Investment) / Cost of Investment] × 100 |
|
Markup |
Markup Percentage = [(Revenue – COGS) / COGS] × 100 |
|
Selling Price using Markup |
Selling Price using Markup = (COGS × Markup Percentage) + COGS |
|
Inventory Shrinkage |
Inventory Shrinkage = [(Recorded Inventory – Actual Inventory) / Recorded Inventory] × 100 |
Business Mathematics
Business mathematics is a fundamental concept in business and economic affairs, where mathematical methods are used to solve business-related questions. It involves various mathematical concepts like fractions, ratios, equations, and finance. The skill of implementing business mathematics is crucial for economic decisions in the areas of accounting, finance, marketing, and operations. With the help of mathematical tools, companies can manage finances, find raw materials, and perform routine tasks smoothly.
Business math mastery enables a person to meet the requirements of the business world and arrive at the required conclusions based on available data.
Table of Content
- What is Business Mathematics?
- Business Mathematics Topics
- Business Mathematics Formulas
- Business Mathematics Examples
- Importance of Business Mathematics
- Solved Examples on Business mathematics
- FAQs on Business Mathematics
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