Revenue, Costs, Profit and Loss

Flashcards about revenue, costs, profit and loss

What is Revenue?

Income earned by selling goods and services; also known as sales revenue or turnover.

How is Revenue calculated?

Price multiplied by quantity sold.

What are Costs?

Money needed to create the goods and services.

What are Fixed Costs?

Costs that do not change with output, such as rent, taxes, salaries, insurance, and lease payments.

What are Variable Costs?

Costs that change with output, such as petrol costs, utility bills, wages for machinists, and raw materials.

What is Average or Unit Cost?

Total costs divided by output, calculating the cost of producing each unit.

How is Profit or Loss calculated?

Revenue minus cost.