CMA EXAM PART 1 FORMULAS

Gross Profit

Revenue-COGS

Net Income Equation

Revenues+Gains-Expenses-Losses

Warranty Liability Calculation

Sales Forecast * % of Historical Warranty Cost based on Sales

DM Efficiency Variance

(Actual Qty of DM @ SP)-(Standard Qty of DM @SP)

Double Declining Balance

(Book value) x 2/EUL

Units of Production/Output Depreciation

(Depreciable Base/Estimated Production Capacity)*Units per year

SYD depreciation

(Remaining useful life of the asset/SYD)*DepreciableBase

Earnings Per Share (EPS)

(net income-preferred dividends)/weighted avg number of common shares outstanding

Average Annual Growth Rate (AAGR)

= (GR1 ...+ GRx) / x periods

Depreciable Base

Acquisition Cost-Residual Value

DM Price Variance

Actual Cost of DM-Actual Qty of DM @ Standard Price

Direct Labor Price Variance Calculation

Actual Cost of Direct Labor-Actual Hours of Direct Labor @ Standard Rate

Direct Labor Efficiency Variance

Actual Hours of Direct Labor @ Standard Rate-Standard Cost of Direct Labor

Flexible Budget Calculation

Actual Qty *Budgeted Price

Sales-Volume Variance

Static Budget Amount-Flexible Budget Amount

Retained Earnings calculation

Beg retained earnings+Net Income/Loss during period-Dividends Paid during period

Static Budget Calculation

Budgeted Qty * Budgeted Price

Weighted Average Cost Method of Inventory

COGAS/# of units avail for sale

Interest Expense calculation for amortizing a premium or discount on bonds

Carrying Value of Bonds @ beginning of period *Effective Interest Rate

Cash Flow Calculation

Cash From Operating Activities+Cash From Investing Activities+Cash Provided from Financing Activities=Net Increase in Cash and Cash Equivalents

Straight Line Depreciation

Depreciable base / EUL

NRV

Expected Selling Price-Total Selling Costs

Flexible Budget Variance

Flex Budget Amount- Actual Results

Residual income

Operating income - (Minimum rate of return x Average operating assets)

Asset Carrying Amount (Physical Asset)

Original Cost-Accum Depreciation-Asset Impairment

Asset Carrying Amount (Intangible Asset)

Original Cost-Amortization Expense-Asset Impairment

COGS calculation

beginning inventory + purchases - ending inventory

Simple Linear Regression Analysis

y=bx+a y:dependent variable b:slope of the regression line x:value of independent variable