Putting a business idea into practice

Question 1

What is a financial objective

Answer 1

Targets expressed in money terms such as making a profit, earning income or building wealth.

Question 2

What does SMART stand for

Answer 2

Specific, measurable, achievable, realistic and timed

Question 3

What is another word for Revenue

Answer 3

Sales Revenue
Turnover
Sales Turnover

Question 4

Define “The amount of income received from selling goods or services over a period of time “

Answer 4

Revenues
Sales Revenue
Turnover
Sales Turnover

Question 5

What is the formula for total revenue (not in symbols)

Answer 5

Total Revenue = Price x Quantity

Question 6

what is the formula for total revenue in symbols

Answer 6

TR = P x Q

Question 7

What is sales Volume

Answer 7

The number of items or products or services sold by a business over a period of time.

Question 8

What the difference between fixed and variable cost

Answer 8

Fixed cost- Costs which do not vary with the output produced such as rent, business rates, advertising costs, administration costs and salaries.
Variable costs-Costs which change directly with the number of products made by a business such as the cost of buying raw materials.

Question 9

What is the formula for total cost

Answer 9

TC = FC + VC

Total Costs = Fixed Costs + Variable Costs

Question 10

What is the total cost

Answer 10

All the costs of a business; it is equal to fixed costs plus variable costs.

Question 11

What is profit

Answer 11

Occurs when the revenues of a business are greater than its costs over a period of time.

Question 12

How do you find out the total cost using profit and total revenue

Answer 12

TR-P=TC

Question 13

What is Cash flow

Answer 13

The flow of cash into and out of a business

Question 14

What is the difference between cash outflow and inflow

Answer 14

Inflows-The cash flowing into a business, its receipts

outflows- The cash flowing out of a business, its payments

Question 15

What is net cash flow

Answer 15

The receipts of a business minus its payments

Question 16

How do you you find outflows by using net cash flow and inflows

Answer 16

Inflows-Net cash flow=Outflows

Question 17

what do you call it when a business can’t pay it dept

Answer 17

Insolvency

Question 18

What is a business amount of money at the start of a month

Answer 18

Opening Balance

Question 19

What is the amount of money at the end of the month

Answer 19

Closing balance

Question 20

Which of these is not an example of short term finance(there is 2)
loans
mortgage
personal savings
overdraft

Answer 20

Mortgage and owners savings

Question 21

Which of these is an example of an external source of fiance
Retained profit
Selling Assets
Personal savings
Factoring

Answer 21

Factoring

Question 22

What is the owner/s of the business called

Answer 22

Shareholdes

Question 23

Define “An individual or company which buys shares in what they hope will be a fast growing company with a long term view of selling the shares at a profit. “

Answer 23

venture capitalist

Question 24

Define “Assets owned by a business which are used to guarantee repayments of a loan; if the business fails to pay off the loan, the lender can sell what has been offered as security. “

Answer 24

Security

Question 25

What is a dividend

Answer 25

A share of the profits of a company received by shareholders who own shares.

Question 26

Which of these don't charge interest
Loans 
Mortgage
Leasing
Overdraft

Answer 26

Leasing