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Price The amount paid by a consumer to purchase one unit of a product

Total Costs The total of variable and fixed costs in a business

Variable Costs Costs that vary directly in proportion to output (e.g.
materials, pay related to amounts produced or sold)

Fixed Costs Costs that do…

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Cash flowThe movements of cash into ("inflows") and out of ("outflows") a

Cash Inflows Receipts of cash, typically arising from sales of items,
payments by debtors, loans received, rent charged, sale of assets and
interest received.

Cash Outflows Payments of cash, typically arising from the purchase of

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Budget A detailed plan of income and expenses expected over a certain
period of time

Management Accounting The production and use of financial and
accounting information for internal purposes of planning review and control.
It is based on predications of what will happen and analysis of the actual
outcomes in…

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overspend its current account in the bank up to an agreed (overdraft) limit
and for a stated time period.

ShortTerm Loan A sum of money provided to a firm or an individual for a
specific, agreed purpose. Repayment of the loan will take place within 2
years, and possibly much…

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or incomes

Profit The difference between the income of a business and its total costs.

Profit= revenuetotal costs

Profitability The ability of a business to generate profit or the efficiency of
a business in generating profit.

Net Profit Margin This measures net profit (although operating profit can
be used) as…

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Capital Invested All of the money provided to the business by owners.

Adviser An external contact of a business that provides support and
advice, sometimes for free

Bank loan A fixed amount loan from a bank that is generally used to
finance longterm assets

Business angel A particular type of…


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