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How to Calculate Gross Profit
How to Calculate Return on Equity
How to Calculate Financial Ratios
How to Calculate a Default Risk Ratio
Calculating Working Capital
How to Calculate Market Growth
How to Calculate Dividend Payout Ratio
Calculating a Cost Basis
How to Calculate Marginal Profit
How to Calculate Sales Margins
How to Calculate a Capitalization Rate
How to Calculate Total Revenue
How to Calculate a Compound Growth Rate
How to Calculate Operating Cash Flow
How to Calculate a Break-Even Point
How to Calculate Direct Labor Cost
How to Calculate Inventory Turnover
How to Calculate Sales Ratio
How to Calculate Intrinsic Value
How to Calculate Earnings Per Share
How to Calculate Depreciation
How to Calculate Efficiency Ratio
How to Calculate Debt to Equity Ratio
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Summary: In order to calculate efficiency ratio, examine the cost of power being put out and divide that by the cost of putting power in. Find out how home appliances can have different efficiency ratios with help from two accountants in this free video on business calculations and accounting.
Spencer Cottam and Jeannine Smith work together at Account Team in Salt Lake City, Utah.read more
"Glad to be with you. My name is Spence, and this is Jeannine, and we're with Account Teams in Salt Lake City, and we help people with their books and accounting and taxes, and all those other things they never like to do. I want to talk to you today about efficiency ratio. This can be related to mainly physical items which you may have or buy. A good example; your furnace goes out, and you look at furnaces and they all have different efficiency ratios. And one says eighty eight percent efficient; one says ninety four percent efficient. What that really means is if you have so much gas going into your furnace and that gas has so much heat value how much do you really get out of that into your home? Well, a good ninety two percent efficient unit would have ninety two percent of all available heat going into their home. The rest would go up in the exhaust gases going up into the atmosphere from the burning. When you're analyzing a piece of equipment, like you're buying an electric motor, they all have efficiency ratios listed on the nameplate of the motor, and you'll find out the higher efficiency motors require less electricity to produce the ten horsepower and the lower ones require more electricity, so you have to evaluate the cost of the motor compared to the cost of putting electricity into the motor with that efficiency ratio."
eHow Article: How to Calculate Efficiency Ratio
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