CPA Exam (Core Sections) Formulas & Calculators
Plug in your numbers and see every result worked out, step by step — then use the reference below to recognise which formula a question is really asking for.
← Back to the full “How to pass CPA Exam (Core Sections)” guideFuture value (savings growth)
Grow a starting amount plus regular contributions at a periodic rate.
Future value
PV(1+r)^N + PMT annuity
…growth on the starting amount
PV(1+r)^N
…value of the contributions
Present value (discounting)
What a future sum (and/or recurring cash flow) is worth today.
Present value
FV ÷ (1+r)^N + PMT annuity
Effective annual rate (EAR)
The true annual rate once compounding is included.
Effective annual rate
(1 + i/m)^m − 1
Compound annual growth rate (CAGR)
The smoothed annual growth rate between two values.
CAGR
(End ÷ Begin)^(1/years) − 1
Formula reference
What each formula means and when to reach for it on exam day.
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Current ratio
current ratio = current assets ÷ current liabilities
Short-term liquidity — ability to cover near-term obligations.
When: Liquidity analysis in FAR/BAR ratio questions.
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Quick (acid-test) ratio
quick = (current assets − inventory) ÷ current liabilities
Liquidity excluding the least-liquid current asset.
When: When inventory is slow-moving or must be excluded.
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Debt-to-equity
D/E = total liabilities ÷ total equity
Leverage — reliance on debt versus owner financing.
When: Solvency and capital-structure analysis.
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Return on equity
ROE = net income ÷ average equity
Profit generated per dollar of shareholder equity.
When: Profitability and DuPont decomposition.
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Gross margin
gross margin = (net sales − COGS) ÷ net sales
Share of revenue left after the cost of goods sold.
When: Profitability and cost-structure questions.
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Present value (lump sum)
PV = FV ÷ (1 + r)^N
Discounting future amounts to today’s dollars.
When: Lease liabilities, bond pricing, and impairment in FAR.
Frequently asked questions
- Is a calculator provided on the CPA Exam?
- Yes. The exam includes an on-screen calculator, and many task-based simulations provide a spreadsheet, so you can compute ratios and present values without bringing your own device.
- What formulas should I know for the CPA Exam?
- Liquidity and solvency ratios (current, quick, debt-to-equity), profitability ratios (ROE, gross margin), and present-value / time-value-of-money math for leases, bonds, and impairment — concentrated in the FAR and BAR material.