To keep your business in tip-top shape, you may need to do some things you dislike, including math.不，您无需记住十亿个公式或参加微积分课。但是，您确实需要熟悉基本的业务公式。

9 Business formulas you need to know

You may not be an accountant, but you should know how to analyze your business’s financial health. So whip out those calculators or pens and paper and read on.

1. Net income formula

财务会计公式，net income, are essential for determining how your business is doing.

净利润均显示了nce between your income and expenses. Net income is also called net profit, net earnings, or yourbusiness bottom line。如果您的净收入为负，则称为净损失。

显然,没有人想要一个负的净收益。负的ative net income means your business has more expenses than revenue. But when you’re starting a business, negative net income is common until you get to your break-even point (which is another fun accounting formula we’ll tackle later).

To find your net income, you need to know your totalbusiness revenueand expenses (including cost of goods sold) during a period. Add up your company’s expenses, like operating expenses, payroll costs, and business loan payments. Then, use this formula:

Net Income = Revenue – Expenses

Why does net income matter? First, you need to know whether your business is gaining or losing money. You can use that information to cut expenses or drive up marketing efforts. Secondly, you need to report your net income on your business’s收入证明。

Net income example

During a period, you earn $25,000 in revenue. You have expenses of $30,000.

Net Income = $25,000 – $30,000

Net Income= -$5,000

You have a net loss of $5,000.

2. Accounting equation

Is your业务资产负债表… balanced? Use theaccounting equationto find out.

The accounting equation shows you how much of your assets you financed through debt vs. equity. You need to know your business’s assets, liabilities, and equity to get started.

Business assets are items of value your business owns. Liabilities are debts you owe. And,商业平等is how much ownership you have in your business.

The accounting equation is:

Assets = Liabilities + Equity

If your assets don’t equal the sum of your liabilities and equity, something’s wrong. You may not have recorded a transaction. Look over your accounting books to find out why your accounting equation is unbalanced.

You can also use the accounting equation to determine how much your business would have remaining if you used your assets to pay off your liabilities. To do this, manipulate the equation to find the difference between your assets and liabilities:

Equity = Assets – Liabilities

Accounting equation example

Let’s say you have liabilities totaling $12,000. Your equity is $20,000.

资产= $ 12,000 + $ 20,000

Assets = $32,000

Your assets must be worth $32,000.

3. Cost of goods sold formula

How much is your small business spending to produce your products or services? If you’re spending too much, your profit margin will be low.

Use the cost of goods sold (COGS) formula to determine how much it costs you to develop products or services during a period.

COGS =在此期间开始库存 +购买 - 结束库存

You need to know your COGS to set prices, calculate net income, and more.

COGS example

Let’s say you have a beginning inventory worth $2,000. You spent $3,000 during the period. Your ending inventory is $1,000.

COGS = $2,000 + $3,000 – $1,000

COGS = $4,000

Your cost of goods sold is $4,000.

4. Break-even point formula

A business’s break-even point is when its total sales equal its total expenses. When you hit your break-even point, you don’t generate a profit or a loss.

Do you know how many products you need to sell or services you must perform to hit your business’s break-even point? Why not find out?

Use thebreak-even point formulato determine how many products you need to sell during a period to break even. You need to know your business’s fixed and variable costs. And, record your sales price per unit.

Break-even Point = Fixed Costs / (Sales Price Per Unit – Variable Costs Per Unit)

Break-even point example

Let’s say you want to determine how many coffees you need to sell per month to break even. You sell coffee for $2.95. You have monthly fixed costs of $2,500. Your variable costs per unit are $1.40.

Break-even Point = $2,500 / ($2.95 – $1.40)

Break-even Point = 1,612.90

You need to sell approximately 1,613 cups of coffee each month to break even.

5. Return on investment

Do you make wise investments? How can you tell?

当您收益超过所支付的费用时，您进行明智的投资。要了解您投资业务的资金的能力，请找到您的return on investment(ROI) percentage.

Use this formula to find ROI:

ROI = [(Investment Gain – Cost of Investment) / Cost of Investment] X 100

ROI example

You invest $5,000 into your marketing strategy. Your strategy leads to an investment gain of $8,000. You know you made a smart move, but how smart?

ROI = [($8,000 – $5,000) / $5,000] X 100

ROI= 60

Your return on investment is 60%—not too shabby.

6. Profit margin

Does your business earn a profit? How does that profit compare to your revenue? Find your business’s profit margin to determine the percentage of revenue you keep after taking care of expenses.

Here is the profit margin formula:

Profit Margin = (Net Income / Revenue) X 100

Shoot for highprofit margins。The higher your margin, the greater your business’s earnings.

Profit margin example

During a month, you have a net income of $2,000. Your revenue is $8,000.

Profit Margin = ($2,000 / $8,000) X 100

Profit Margin = 25%

Your profit margin is 25%. This means you get to keep 25% of your business’s revenue.

7. Current ratio

Do you have more assets or liabilities? Let’s find out! Use the current ratio to compare your current assets to current liabilities.

流动资产是您企业拥有的价值项目，可以在一年内转换为现金。同样，流动负债是您一年内应付的债务。

To find your current ratio, divide your current assets by your current liabilities:

Current Ratio = Current Assets / Current Liabilities

结果表明您的资产比负债多得多。您的当前比率应该大于一个。当前比率少于一个意味着您的流动负债比资产更多。

Current ratio example

After totaling up your assets, you find that you have $10,000 in current assets. And, the sum of your liabilities is $10,000.

Current Ratio = $10,000 / $10,000

Current Ratio = 1

Your current ratio of 1 means you have enough in assets to cover your current liabilities.

8.标记公式

If you need help setting your products’ prices, you can try using the markup formula. The markup percentage shows you how much more you sell offerings for than what they cost.

A higher markup can lead to a greater profit margin. But remember,markup vs. marginare different.

要查找您的标记百分比，请使用此公式：

Markup Percentage = [(Revenue – COGS) / COGS] X 100

You can also choose a markup percentage and multiply it by the cost of your product or service to set your selling price. To use markup to find your selling price, use the following formula:

Selling Price Using Markup = (COGS X Markup Percentage) + COGS

Markup example

Let’s say you sell desks for $700. The cost to build the desks is $300 each. What’s your markup percentage?

Markup Percentage = [$700 – $300) / $300] X 100

Markup Percentage = 133.33%

您将桌子标记为133.33％。

Now, let’s find out what your selling price would be if you wanted to mark up your desks by 70%.

使用标记销售价格=（$ 300 x 0.70） + $ 300

Selling Price Using Markup = $510

如果您想使用70％的标记百分比，则需要以510美元的价格出售您的桌子。

Setting prices is your first step to profiting. Download ourFREEguide, “Price to Sell … and Profit,” to start setting prices that are based on data.

9. Inventory shrinkage formula

Does your business have less inventory than what you started with? If so, you’re experiencinginventory shrinkage, or loss. Some shrinkage is normal, but too much can be a bad sign.

If you want to figure out the percentage of inventory your business is losing, use the inventory shrinkage formula.

You need to know how much inventory you should have. And, you must know how much inventory you have after losing some to things like damage and theft.

First, determine how much inventory you should have. This is the amount of inventory recorded in your books. Subtract cost of goods sold from inventory to find your recorded inventory.

The inventory shrinkage formula is:

库存收缩= [（记录的库存 - 实际库存） /记录库存] x 100

The lower your inventory shrinkage percent, the better.

Inventory shrinkage example

You have recorded inventory of 500 lightbulbs. After an unfortunate mishap, you shattered quite a few, leaving you with 375 lightbulbs. What is your inventory shrinkage percentage?

Inventory Shrinkage = [(500 – 375) / 500] X 100

库存收缩= 25％

You lost 25% of your inventory to shrinkage.

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This is not intended as legal advice; for more information, please点击这里。