Business 1.3 Putting Business Ideas Into Practice

Front 1

Financial objectives of a business

Back 1

Survival

Profit

Wealth

Income

Financial Security

Market share

Front 2

Non-financial objectives

Back 2

Personal satisfaction

Challenge

Independence

Control

Helping others

Front 3

Profit = ___________-_________

Back 3

Profit = Revenue - Total Costs

Front 4

Sales Revenue = _______x______

Back 4

Sales Revenue = selling price x Sales volume

Front 5

Total Costs = ________+_________

Back 5

Total Costs = Foxes Costs and Variable Costs

Front 6

Variable costs = ______x_______

Back 6

Variable costs = cost per unit x sales volume

Front 7

Variable costs = ______x_______

Back 7

Variable costs = cost per unit x sales volume

Front 8

Interest = (______-_____/______) x100

Back 8

Interest = (total repayment - borrowed amount/ borrowed amount ) x 100

Front 9

Break even point

Back 9

The level of output when Revenue = costs. Neither a profit or a loss is made.

Front 10

Break even = _____/______-______

Back 10

Break even = fixed costs/ sales price - variable costs

Front 11

Margin of safety

Back 11

The difference between the current level of output and the breakers level of output.

Front 12

What happens to the break even if:

a) Costs go up

b) your sales price

Back 12

If Costs go up the break even point will become larger (further along the chart)

If your sale price goes up the break even point becomes lower (closer on a chart)

Front 13

Cash flow

Back 13

The movement of money into and out of the business (inflow and outflow). Cash is used to pay everyday expenses.

Front 14

Why is cash flow important to a business?

Back 14

To pay expenses

To prevent business failure

Front 15

Net cash flow ______-______

Back 15

Total cash flow in - total cash flow out