2.3.1 Statement Of Comprehensive Incone And Profitability

Question 1

What is a statement of comprehensive income

Answer 1

The statement of comprehensive income at its most basic communicated the revenue generated and then its profits at various levels following a series of expenses and income exceptional incomes

Question 2

What can you find out from a statement

Answer 2

• changes in the sales revenue
• changes in the direct cost of sales
• how well a business is managing operating costs
• the profitability of a business
• unusual incomes/ expenses during the year

Question 3

What are ways to increase revenue

Answer 3

• Increase prices
• reduce process
• create awareness and desire through marketing
• add value to the product and increases benefits

Question 4

How do you improve profitability

Answer 4

Increase revenue while trying to cut costs

Question 5

Why do some business become unprofitable

Answer 5

• no demand in a product
• selling at the wrong price
• low contribution of per unit
• poor management costs
• expansion of the business

Question 6

How do you reduce costs

Answer 6

• reducing production costs
• improve efficiency
• use capacity more fully
• eliminate unprofitable processes
• reduce variable costs
• lower overheads