Theme 2 Flashcards
1
Q
What is sales revenue?
A
Price multiplied by quantity sold
OR
INCOME FROM SALES
2
Q
What is total costs?
A
Fixed costs + variable costs
3
Q
Two benefits using batch production
A
- it in involves manufacturer of limited identical products
- production of foods such as pastries are flexible (new taste etc)
- Less capital to set up batch production
4
Q
Total variance ?
Profit?
A
Actual profit - budgeted profit.
Sales rev. - total costs
5
Q
What is flow of production?
A
Manufacturer of a product in a continuous moving process.
6
Q
What is margin of safety?
A
The difference between current level of output and the break even level of output
7
Q
What is a stock?
A
Stocks are items held by business for future sale such as raw materials
8
Q
Net profit margin formula
A
Net profit/revenue x 100
9
Q
What is break even?
A
Fixed costs/contribution per unit*
*selling priceーvariable cost per unit
