TOPIC 1.3 Putting a business opportunity Flashcards
Revenue
The amount of income received from goods or services over a period of time through sales
Fixed costs
Costs which do not vary with the output produced
Variable costs
Costs which change directly with the number of products made by a business
Insolvency
When a business can no longer pay its debts
Cumulative cash flow-
The sum of cash that moves in a business over time.
Trade credit
Where a supplier gives a customer a period of time to pay a bill (or invoice) for
goods or services, once they have been delivered.
Stocks-
Materials that a business holds.
Some could be materials waiting to be used in the production process, and some could be finished stock waiting to be delivered to customers.
Business plan
A plan for the development of the business giving forecasts of items such as
sales, costs and cash flow
Share
A part ownership of a business
Share capital-
The monetary value of a company which belongs to its shareholders
Shareholders
The owners of a company
Venture capitalist
An individual or company who buys shares in what they hope will be a fast-growing company, with a long-term view of selling shares at a profit.
Dividend-
A share of the profits or a company received by shareholders who own shares
Retained profit
Profit which is kept back in the business and used to pay for investment in
the business.
Overdraft facility
Borrowing money from a bank by drawing more than is actually in the
current account. Interest is charged on the amount overdrawn.
