How to make your own accounting formula and ratio sheet

Ask a strong accounting student what sits on their desk during revision. Often it is a single sheet of the formulae and ratios they use most. It is not a printout or a downloaded cheat sheet. They wrote it themselves.

That matters more than it looks. This article explains how to build such a sheet and, just as important, how to stop needing it.

Why a formula sheet earns its place

Accounting has a manageable set of relationships you must reproduce without hesitation: mark-up, margin, the current ratio and a few others. In the exam you are usually not given them. A good sheet gathers them in one glance, so you can see the whole toolkit and notice which relationships you keep confusing.

Fitting everything on one page also forces you to decide what matters and to state each formula in its cleanest form. That selecting is revision. You cannot summarise what you do not understand.

Why making it yourself aids recall

A sheet copied from a textbook barely helps memory, because copying is passive. Your hand moves but your mind idles. A sheet built from your own understanding is different.

To write down how mark-up relates to cost and margin relates to selling price, you must retrieve those relationships and put them in your own words. That retrieval builds memory.

Two students can end up with almost identical sheets, but the one who built theirs from scratch will remember far more. Treat building the sheet as a study session in its own right.

What to include

Include the relationships you will use, grouped so related ideas sit together. For example:

• Profitability: how gross profit relates to sales and cost, how mark-up and margin differ, and how to convert one into the other.
• Liquidity: the current ratio and the more cautious measure that leaves out inventory.
• Efficiency: relationships around the use of assets and the collection of what is owed.

For each entry, write the relationship clearly and add a short note on what it tells you. “Current ratio: can short-term debts be met?” helps your future self more than the formula alone.

Do not cram in everything. A crowded sheet is hard to scan.

Do not attribute formulae to a syllabus you have not checked

Mark-up, margin, the current ratio and the rest are general accounting knowledge and belong on your sheet. Do not add claims about which section of a particular exam board’s syllabus they appear in, how many marks they carry or how they will be examined. Those details vary and change, and a guess puts errors on the sheet you trust most. Check your own board’s published materials for how these are assessed.

Lay it out so it teaches you

Group related formulae, leave white space between blocks and use a consistent format. If two formulae are easily muddled, as margin and mark-up are, put them side by side with a note on exactly how they differ.

Write it by hand if you can. Handwriting is slower than typing, and that slowness forces the retrieval that makes the sheet worth having. A neat digital copy can come later.

Use it actively, then wean off it

A formula sheet is a scaffold, and scaffolding is meant to come down. If you keep it by your side until the exam, you may find you cannot work without it.

Start by attempting practice questions with the sheet visible. After a few sessions, try to recall each formula before you glance at the sheet, using it only to confirm or correct. Then cover it and attempt a question from memory, looking only when stuck.

Finally, try to reproduce the whole sheet from a blank page. If you can, you no longer need it.

A quick routine for weaning off

1. Blank-page test: write out every formula you can remember, then compare with your sheet and mark the gaps.
2. Targeted repair: study only the ones you missed, not the whole sheet.
3. Repeat after a few days. The gaps should shrink each round.

When two rounds in a row come back complete, the sheet has done its job and you can retire it.

If your child would like help deciding what belongs on their sheet, one of our teachers can guide them. They can then practise the relationships together until the sheet is no longer needed. Book a trial class to see how.