Things In My Mocks Flashcards
cash inflow
Total cash inflow = sales revenue+ Loans+Investments+Grants+Asset sales+Other incomes
what is franchise
A franchise is a business that licenses a brand and model for a fee.
benefit and disadvantages of franchise
- Established Brand – Customers already recognize and trust the business.
- Support & Training – The franchisor provides guidance, reducing risks.
Disadvantages of a Franchise:
1. High Costs – Franchise fees and ongoing royalties can be expensive.
2. Less Control – Franchisees must follow strict rules set by the franchisor.
meaning of aesthetics
In business, aesthetics means the visual appeal of products and branding.
what is insolvency?
when a business or individual cannot pay their debts on time or their liabilities exceed their assets.
what is market segmentation?
divides a market into smaller target groups.
what is added value?
is the increase in worth a business creates by improving a product or service.
overdraft advantage and disadvantage
Advantages of an Overdraft:
1. Flexible Access – Provides quick access to extra funds when needed.
2. Short-Term Solution – Helps cover temporary cash flow issues.
Disadvantages of an Overdraft:
1. High Interest Rates – Can have higher fees and interest compared to other credit options.
2. Repayment Pressure – Must be repaid quickly, which can strain finances.
risks of starting a business?
- Financial Loss
- Uncertain Cash Flow
- Market Competition
- Legal Risks
- Operational Challenges
types of costs
fixed and variable
meaning of fixed and variable costs
- Fixed Costs – Costs that do not change with the level of production or sales, such as rent, salaries, and insurance.
- Variable Costs – Costs that vary directly with the level of production or sales, such as raw materials, labor, and shipping.
net profit
total revenue - total expenses
loan interest
principle x interest rate x time period
net cash flow
cash inflow - cash outflow
total net cash flow
starting cash + net cash flow over period
