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A to Z of business calculations

A glossary of business calculations, formulas and ratios from our collection of online reference books. Each entry includes a summary of what the calculation measures, why it's important and how it works in practice.

The entries in this A-Z have been sourced from the QFinance Calculation Toolkit (A & C Black, 2013). This title is available to ICAEW members and ACA students through the Ebook Central collection.

A

Accounts payable turnover ratio

Accounts receivable turnover

Accrual rate

Acid test ratio

Activity based costing

Alpha value of a security

Amortization

Annual percentage rate

Annuity future value

Asset turnover

Asset utilization

B

Basis point value

Beta value of a security

Binomial distribution

Bond current price

Bond yield

Book value

Borrowing costs and capitzalization

Break even analysis

C

Capital asset pricing model

Capital expenditure

Capitalization ratios

Central limit theorem

Compound interest

Contribution margin

Conversion price

Conversion ratio

Convertible preferred stock

Cost of goods sold

Covariance

Creditor days

Current price of a bond

Current ratio

D

Days sales outstanding

Debt to capital ratio

Debt to equity ratio

Debtor days

Depreciation

Discounted cash flow

Dividend yield

E

EBITDA

Earnings at risk

Earnings per share

Economic value added

Efficiency and operating ratios

Elasticity

Enterprise value

Exchange rate risk

Expected rate of return

F

Fair value calculations

Forward interest rates

Future value

Future value of an annuity

G

Goodwill and patents

Gross profit margin ratio

H

I

Interest coverage

Interest rates

Internal rate of return

J

K

L

Liquidity ratio analysis

M

Marginal cost

Marginal rate of substitution

Market book ratio

N

Net added value and adjusted nav

Net present value

Nominal and real interest rates

O

Option pricing

P

Payback period

Payout ratio

Portfolio analysis

Price earnings ratio

Price elasticity

Price sales ratio

Q

R

Rate of return

Real interest rates

Reserve ratio

Residual value

Return on assets

Return on investment

Return on sales

Return on stockholders equity

Risk adjusted rate of return

S

Sharpe ratio

Statistical process control methods

Swap valuation

T

Term structure of interest rates

Time value of money

Total return

Treynor ratio

U

V-Z

Value at risk

Weighted average cost of capital

Working capital

Working capital productivity

Yield

Z score

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