mr s definitions

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  • Created by: dxnise0
  • Created on: 11-10-19 10:40
Revenue
the income that a business has from its normal business activities (sale of goods + services to customers)
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cash flow
The difference between the available cash at the beginning of an accounting period and that at the end of the period
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net flow cash
the difference between a company's cash inflows and outflows in a given period
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Profit
the revenue remaining after all costs are paid
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Break-even
the point at which cost or expenses and revenue are equal: there is no net loss or gain
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margin of safety
how much output or sales level can fall before a business reaches its break-even point
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how to calculate profit
profit = revenue – cost
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how to calculate break-even point/output
Break-even output = fixed costs/(selling price –variable cost)
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sales revenue
the money recieved from selling goods
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cost of sales
the cost of raw materials involved in production
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gross profit
other fixed costs including rents + rates needed for its planning + monitoring purposes
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net profit
the profit after all costs have been deducted
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margin of safety equation
annual input - break even output
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TR equation
P x G
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TC equation
FC + VC
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profit equation
TR - TC
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stakeholder
affected by the actions, objectives & policies
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external stakeholder
individuals or groups outside a business or project, but who can affect or be affected by the business or project
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internal stakeholders
individuals or groups who are directly and/or financially involved in the operational process
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variable costs
changes in proportion to production output
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long term liabilities
debts not likely to be paid within a year
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current liabilities
debts expected to be paid within a year
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current assets
assets likely to be converted into cash within one year
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fixed assets
assets not likely to be converted into cash within one year
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working capital
the difference between current assets and current liabilities
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working capital equation
CA - CL
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capital finance / equity
the amount of money used to set up a business
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the difference between revenue, profit and cash flow
revenue is the money a company earns from the sale of their products/services • cash flow is the net amount of cash being transferred in & out of a company • profit is the revenue less the expenses
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name 3 variable costs
• raw materials • transaction fees • rent •insurance
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closing balance
opening balance + net cash flow
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net cash flow
cash in - cash out
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Other cards in this set

Card 2

Front

The difference between the available cash at the beginning of an accounting period and that at the end of the period

Back

cash flow

Card 3

Front

the difference between a company's cash inflows and outflows in a given period

Back

Preview of the back of card 3

Card 4

Front

the revenue remaining after all costs are paid

Back

Preview of the back of card 4

Card 5

Front

the point at which cost or expenses and revenue are equal: there is no net loss or gain

Back

Preview of the back of card 5
View more cards

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