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What are fixed costs?
Fixed Costs are costs that stay the same no matter how many items are made. eg. Rent.
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What are variable costs?
Variable Costs are costs that change depending on how many items are made. eg. wages.
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What are direct costs?
Direct Costs are costs that can be linked to the production of an item. eg. raw materials.
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What are operating costs?
Operating Costs are also known as running costs. They are paid to keep the business working on a day to day basis. eg. electricity
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What is profit?
Profit is when revenue is higher than expenditure meaning the business has spare money left over.
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What is the margin of safety?
The margin of safety is the difference between the target sales and breakeven point that the business has.
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What is the formula for margin of safety?
actual level of sales-breakeven point=margin of safety
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How do work out profit?
revenue-expenditure=profit
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What is the formula for loss?
revenue-expenditure=loss
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Card 2

Front

What are variable costs?

Back

Variable Costs are costs that change depending on how many items are made. eg. wages.

Card 3

Front

What are direct costs?

Back

Preview of the front of card 3

Card 4

Front

What are operating costs?

Back

Preview of the front of card 4

Card 5

Front

What is profit?

Back

Preview of the front of card 5
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