5.3, 5.4, 5.5, 4.1, 4.2  (copy)

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Finance

10th

40 Terms

1

capital

Start up ________ (finance needed by new businesses to pay for non- current and current assets before it can begin trading)

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2

Income statement

________: shows if the business is making a PROFIT or LOSS.

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3

Statement

________ of financial position: a financial account which shows what the business is worth at any given period of time.

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4

Cash

________: the actual money the business has in its bank account.

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5

Gross profit

________= revenue-cost of sales.

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6

Reward

________ for risk taking- profits ________ entrepreneurs for taking risks and allowing payments to be made.

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7

Revenue expenditure

________ (money spent on day- to- day expenses* do not involve the purchases of long- term assets)

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8

Capital expenditure

________ (money spent on non- current assets which will last for more than a year)

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9

Source of finance

________- profits after payments to owners are a very important source of finance for businesses.

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10

Indicator of success

________- if some businesses are profitable, profit can be an indicator for other businesses as to whether producing similar goods or services would be profitable.

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11

Profit

________ can be increased by increasing total revenue or decreasing total costs.

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12

Capital

________: money invested into the business by the owners.

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13

Accounts

the financial records of a firms transactions

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14

Income statements

a financial statement that records the income of a business and all costs incurred

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15

Profit = Total revenue

Total costs

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16

Cash

the actual money the business has in its bank account

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17

Trading account

shows the information at the top of a cashflow forecast (revenue and cost of sales), and how to calculate gross profit

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18

Revenue/sales/sales revenue/total revenue

the amount earned from the sales of products

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19

Cost of sales

the cost of purchasing the goods used to make the products sold

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20

Cost of sales = cost per unit x number of sales Gross profit

the difference between revenue and cost of sales

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21

Gross profit = revenue

cost of sales

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22

Expenses

the day-to-day costs of running a business

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23

Net profit

the actual profit after expenses (not including gross profit) have been paid

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24

Net profit = gross profit

expenses/overheads

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25

Reward for enterprise

entrepreneurs may have important qualities and characteristics and profit rewards them for this)

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26

Reward for risk taking

profits rewards entrepreneurs for taking risks and allowing payments to be made

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27

Source of finance

profits after payments to owners are a very important source of finance for businesses

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28

Indicator of success

if some businesses are profitable, profit can be an indicator for other businesses as to whether producing similar goods or services would be profitable

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29

Statement of financial position

a financial account which shows what the business is worth at any given period of time

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30

Business assets

something owned by the business

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31

Liabilities

something owed by the business

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32

Capital

money invested into the business by the owners

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33

Income statement

shows if the business is making a PROFIT or LOSS

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34

Assets

Inventories, Van/truck, Debtors, Cash

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35

Liabilities

Overdrafts, Mortgages, Trade creditors

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36

capital

Start up ________ (finance needed by new businesses to pay for non- current and current assets before it can begin trading)

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37

Accounts

________: the financial records of a firms transactions.

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38

Profit

________ can be increased by increasing total revenue or decreasing total costs.

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39

Accounts

the financial records of a firms transactions

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40

Income statements

a financial statement that records the income of a business and all costs incurred

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