Business finance sheet1

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  • Fianance
    • business costs
      • running costs
        • Business has to pay these on a regular basis.
        • split into two types: variable costs and fixed costs
          • fixed costs does not change depending on output
          • variable costs change depending on output
      • start-up costs
        • What a business has to invest in to start up the buisness
      • The total cost is the amount of money spent by a firm on producing a given level of output. Total costs are made up of fixed costs (FC) and variable costs (VC).
    • Revenue
      • money a business receives
      • main ways of getting revenue are selling products or services
      • Revenue is sometimes called sales, sales revenue, total revenue or turnover.
    • profit/loss
      • profit is the money a business has left
      • If a business spends more money than it receives it means its making a loss
    • Breaking even
      • The break-even point is when the ammount of money spent on making the product is the same as the money made from selling the product
    • accounts
      • a bank statement shows what a business is worth presently
        • This also shows the current assets
          • a curremt asset is something a business owns for under 12 months and can be easily turned into cash
        • This will also show fixed assets
          • A fixed assest is something a business will own for more than 12 months.
        • the bank statement also shows current liablilities
          • A liability is something a business owes to another business or person
      • a cashflow forecsdt shows what money is coming in and out of a business.
      • a profit and loss acdount shows the profit and loss a business makes.


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