2.4 Making Financial Decisions

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4 Terms

1
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income statement

shows a summary of a business’ trading and expenses in order to identify if a profit or a loss has been made. the components are:

  • sales revenue

  • cost of sales

2
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how financial data support, inform and justify business decisions

  • keeps the business and other stakeholders informed about the businesses performance

    • profit or loss?

    • how much the business is worth

  • stakeholders can asses current performance against: past performance and competitors

  • informs managers on the payment of suppliers

  • helps informs future decisions

3
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use of marketing data to support, inform and justify business decisions

  • keeps the business and other stakeholders informed about business performances and helps to justify

    • new product development

    • pricing strategies

  • allows stakeholders to assess current performance against performance and competitors

  • helps inform future decisions

4
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use of market data to support, inform and justify business decisions

  • keeps the business and other stakeholder informed about businesses performance and helps to justify

    • market share, size and growth

  • shows information regarding current and potential competition