Definitons Flashcards
Quality control
A system for the inspecting the quality of the goods or services produced and ensuring that they are of the required standards.
Face to face
Involves direct contact between buyer and seller, for example, a sale completed in a shop
Telesales
Sales completed over the telephone
E-commerce
The bringing together of buying and selling electronically
Consumer law
The area of law which protects the stumpers of a business, mainly through the Consumer Rights Act of 2015
Supply chain
The chain of business involved in the production of a product and it’s delivery to the user.
Trade credit
When the business buys goods to sell and does not need to pay the supplier for a period of time - Often 30 days.
Overdraft
An arrangement with a bank that a business can spend more money then it has in its account.
Owners’ capital
Money from the savings put into the business by the owner(s).
Retained profit
Profit that is not distributed to shareholders as dividend
Crowdfunding
Money raised through an appeal to the public who are supported of the business.
Loan
A sum of money borrowed for a stated period at an agreed rate of interest.
External finance
Finance raised from sources outside the business. The main external sources of finance are overdraft, trade credit, loan, crowd fund ain’t and share issue.
Internal finance
Finance raised from within the business. The main internal sources of finance are owners’ capital, retained profit and sales of assets.
Fixed costs
Costs that stay the same regardless of a change in output, for example, rent for offices, shops, factories or land and the uniform business tax which is a tax based on the location of the business.
Variable costs
Costs that change as output changes, for example, wage and material costs will increase if more products are made or sold.
Costs of sales
The cost to the business of production goods to sell, for example, buying materials and employing workers to make a product.
Expenses
The costs of operating the business, including wages and salaries, rent, or mortgage payments, insurance, heating and lighting and advertising.
Average rate of return (ARR)
A method of measuring and comparing the profitability of and investment over the life time of the investment.
Break-even quantity
The amount a business must sell to earn enough revenue to just cover its costs so it does not make a profit or a loss.
Forescast
A prediction. The forecast break-even output of a business is a prediction.
Liquidity
The ability of a business to pay its short-term debts.
