Business Costs Flashcards
1
Q
What is ‘Revenue’?
A
Income earned by a business
2
Q
How do you calculate revenue?
A
sales x price
3
Q
What are costs?
A
Expenses paid out to run the business
4
Q
Name the four types of costs
A
Direct and Indirect
Fixed and Variable - sometimes Semi-variable
5
Q
Describe ‘direct’ costs
A
Expenses for a particular product - labour, raw materials and operating machinery
6
Q
Describe ‘indirect’ costs
A
General expenses for running a business - salaries, telephone bills and office rent
7
Q
Describe ‘fixed’ costs
A
They don’t change - mostly indirect costs - they have to be paid
