WEEK 9: PROFIT, LOSS & BREAK-EVEN

Question 1

describes the financial benefit when revenue generated from the business exceeds the expense, cost & taxes involved in sustaining the business

Answer 1

PROFIT (P)

Question 2

• is a decrease in net income that is outside the normal operations of business
• it is an excess in expense over revenue

Answer 2

LOSS (L)

Question 3

having an equal cost & incomes

Answer 3

BREAK-EVEN

Question 4

is the point at which the cost & revenues are equal

Answer 4

BREAK-EVEN POINT (BEP)

Question 5

2 components of break-even point

Answer 5

1. FIXED COST (FC)
2. VARIABLE COST (VC)

Question 6

are the costs that do not change with with varying outputs

salary, rent, building, machinery

Answer 6

FIXED COST (FC)

Question 7

the cost incurred to create a unit

employee labor, raw materials, sales commissions

Answer 7

VARIABLE COST (VC)