Kate Mooney

Accounting, as you may guess, involves a lot of math. As you practice various types of accounting problems, and when you begin doing accounting work for real, you will need to utilize various formulas to calculate the information you need.10 useful accounting formulasThe following are some of the most frequently used accounting formulas.

Manufacturing costs are directly associated with production; they include direct materials, direct labor, variable overhead, and fixed overhead. A manufacturer will use this information to determine the cost of their product. In the following practice questions, you are asked to weed out the non-manufacturing costs and then calculate the total manufacturing costs for two different companies.

As its name implies, the statement of changes in stockholders' equity includes only items that impact a corporation's equity. The following practice questions will bring you up to speed on what this statement includes and leaves out. Practice questions Which of the following is not included on the statement of changes in stockholders' equity?

Return on Equity (ROE) and Return on Sales (ROS) are two different ways to measure a company's profitability. ROE is used by outside investors, while ROS is used by the people in the company. The following practice questions ask you to calculate both ROS and ROE for the same company. Practice questions Use the following information to answer the questions.

If you want to know whether a company can pay its current liabilities, you need to look at a special ratio called its current cash debt coverage. The following practice questions ask you to calculate this ratio for two different companies. Practice questions Trendy Royal Coaches has these comparative balance sheets: From the statement of cash flows, cash provided by operating activities was $350 in 2015 and $270 in 2014.

When you want to determine how well a company is performing, a good way to find out is by calculating its Return on Investment (ROI). You find the ROI by dividing operating income by average operating assets. The following practice questions ask you to calculate the ROI for one company and then compare the ROIs for different divisions of another company.

When a bookkeeper records sales transactions for a company, the way she records them depends on whether the sales are made on account, with credit cards, or with cash. The following practice questions ask you to combine all three transaction types in order to calculate a company's total sales for a day. Practice questions Use the following information to answer the questions.

Product costs are included in the cost of a product. These costs become expenses when the product is sold. Period costs, on the other hand, are expensed immediately when they're incurred. In the following practice questions, you're asked to separate period costs from product costs for one company, and then to tally up product costs for another.

If you know the manufacturing costs of a product, and how many units you have produced and sold, then you can determine the per-unit cost. The following practice questions walk you through the process. Practice questions Goody Picnic Tables Inc. has the following per-unit information: Selling price: $450 Raw materials used to construct the product: $95 Labor to build the product: $75 Overhead associated with building the product: $14 Sales commission: $25 Administrative costs: $12 The company produced 250 units and sold 240.