Financial Planning all formulas
Answers
Formula No. 1: Calculate your cash flow
Income – Expenses = Cash flow
Formula No. 2: Find leverage ratio using income
Debt payments ÷ Income = Leverage ratio
Formula No. 3: Find leverage ratio using equity
Total debt ÷ Total equity = Leverage ratio
Formula No. 4: Calculate inflation-adjusted return
(1 + Investment return) -:- (1 + Inflation rate) - 1 x 100 = Real return
Formula No. 5: Calculate your gains (or losses)
(Market price – Purchase price) ÷ Purchase price = Percentage increase
Formula No. 6: How long to double your money
72 ÷ R (the annual interest rate of the investment) = Years to double investment
Rate of GST = GST / Taxable value × 100
Discount = Printed price × Rate of Discount
GST payable = Output tax - ITC
Sum invested = Number of shares × MV
Rate of return = Dividend income / Sum invested × 100
Buying price of 1 share = MV + Brokerage
Selling price per share = MV - Brokerage
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