Lesson 16-Business costs,revenue and profit Flashcards
1
Q
Define fixed costs
A
costs that do not vary in relation to the level of output
2
Q
What is another name for fixed costs
A
Overheads
3
Q
Define variable costs
A
Costs that vary in direct proportion to the level of output or activity
4
Q
Define total costs
A
The addition of variable cost and fixed cost
5
Q
What is the formulae for total costs
A
Total cost= total variable cost+fixed cost
6
Q
What is the formulae for cost per unit or average cost
A
Total cost/Number of units
7
Q
Define revenue
A
The money generated from the sale of output
8
Q
What is the formulae for total sales revenue
A
Total sales revenue= selling price x Quantity sold
9
Q
Define profit
A
The difference between total revenue and total cost
10
Q
What is the formulae for profit
A
Total revenue- Total Cost
