Production is about creating goods and services. Managers have to decide on the most efficient way of organising production for their particular product
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What is job production?
Job production is where items are made individually and each item is finished before the next one is started. Designer dresses are made using the job production method.
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What is batch production?
Batch production is where groups of items are made together. Each batch is finished before starting the next block of goods.
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What is flow production?
Flow production is where identical, standardised items are produced on an assembly line. Most cars are mass-produced in large factories using conveyor belts and expensive machinery such as robot arms. Also workers have specialised jobs.
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What is revenue?
Revenue is the income earned by a business over a period of time, eg one month. The amount of revenue earned depends on two things - the number of items sold and their selling price. In short, revenue = price x quantity
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What is cost?
Costs are the expenses involved in making a product. Firms incur costs by trading.
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What is profit?
Profit is the money left over when all other expenses have been paid. Profit = total revenue - total costs.
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What is loss?
A loss is made when the revenue from sales is not enough to cover all the costs of production. For example, if a company has a total revenue of £60,000 and a total cost of £90,000, then they have lost £30,000 from trading.
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Other cards in this set
Card 2
Front
What is production?
Back
Production is about creating goods and services. Managers have to decide on the most efficient way of organising production for their particular product
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