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9 Cards in this Set
- Front
- Back
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What Are Cash Outflows? |
-Mortgage Repayments -Electricity -Running Costs -Wages -Advertising |
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What Are Cash Inflows? |
Money coming into the company from selling goods or services. |
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How Can Businesses Improve Cash Flow? |
-Increase Sales -Make Customers Pay Deposits -Destock Or Do Not Hold Much Stock |
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What Is Profit? |
The amount of money a business is left with after paying all of its costs. It is the difference between revenue and costs. |
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What Are Three Ways That Profit Can Be Improved? |
-Reducing Costs: reduce workforce, contract out work, cut wages. -Increasing Revenue: raise prices, increase sales, introduce new products. -Expanding. |
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What Is The Break Even Point? |
The point at which the business is neither making a profit or a loss. All output below the point is a loss and above is a profit. |
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What Is The Margin Of Safety? |
The amount that sales can fall by before the business' profit is wiped out. |
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What Is The Formula To Calculate The Break Even Point? |
Fixed Costs / Unit Contribution (unit contribution= selling price - variable cost per unit) |
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What Methods Can A Business Use To Grow? |
-Profit -Selling Assets -Personal Funds -Share Capital: selling more shares -Debt: getting a loan -Floatation On The Stock Exchange |
