business revenues, costs and profits

Question 1

define revenue and how to calculate

Answer 1

the total income from sales
revenue= price x quantity sold

Question 2

define fixed costs and how to calculate

Answer 2

costs that remain constant regardless of output (eg rent/salaries)
fixed costs= total- variable costs

Question 3

define total costs

Answer 3

fixed costs + variable costs

Question 4

define variable costs

Answer 4

costs that vary with output (eg materials or packaging)
variable costs= total- fixed costs

Question 5

what is profit

Answer 5

revenue- total costs

Question 6

what is loss

Answer 6

when costs exceed revenue

Question 7

what is interest

Answer 7

cost of borrowing money, calculated as a percentage of the loan
total repayment- borrowed amount/borrowed amount *100

Question 8

break even level of output

Answer 8

the number of units sold needed to cover costs

Question 9

margin of safety

Answer 9

how much sales can fall before the business break even point reached again and stop making profit
actual output-break even output