buisness finance unit 5 Flashcards
what is the finance function
mange’s cash flow
what is trade credit
suppliers dilver goods then ask for payment later
what is retained profit
established business keeps profit to use in the future
what is owners capital
own ever such as sole traders invest their own money
what is share issue
limited companies release more shares for sale
how do you find the revenue
selling price x number sold
what is fixed cost
stays the same no matter what
what is a variable cost
the cost will change
2 examples of fixed costs
rent
insurance
loan repayments
what are 2 types of variable costs
raw materials
packaging
components
how do you find the total costs?
fixed cost + total variable costs
how to calculate gross profit
revenue - cost of sales
how to calculate net profit
gross profit - expenses
what is gross profit
the money they keep
how to find a gross profit MARGIN
gross profit
—————— x 100
total revenue
how to find net profit MARGIN
net profit
—————— x100
total revenue
