BTEC Tech Award Enterprise C3 Exam Review

A set of 100 flashcards designed to help students review key concepts related to enterprise management, financial documents, and marketing strategies.

What is the primary purpose of financial documents for enterprises?

To keep an accurate record of transactions and identify financial positions.

What is a purchase order?

A document that records an order from the buyer to the supplier, listing goods or services to be purchased.

What does B2C stand for in marketing?

Business to Consumer, where businesses sell directly to consumers.

What is an example of below-the-line promotion?

Posters and sales discounts.

What is a loyalty card scheme?

A promotion strategy offering discounts to regular customers.

What is one advantage of using below-the-line promotion?

It directly targets specific consumers, leading to potentially higher engagement.

How does a budget help an enterprise?

It aids in planning future expenditures and revenues to ensure profitability.

What would a marketing budget cover?

Estimated costs required to successfully market the enterprise and its products.

What is a remittance advice slip?

A document that accompanies payment to notify the supplier that an invoice has been paid.

What document accompanies goods to list what was ordered and delivered?

Delivery note.

What is an invoice?

A formal statement showing what a customer has bought and providing payment details.

What is the purpose of a credit note?

To notify a customer of a reduction in the payment they owe due to issues with the original order.

Name a benefit of adding to a product portfolio.

It can attract new customers and increase sales opportunities.

What is the definition of gross profit?

The profit after the cost of goods sold is deducted from revenue.

What does NPM stand for?

Net Profit Margin, a measure of net profit as a percentage of sales revenue.

Why is accurate financial documentation crucial?

To ensure the enterprise can track payable and receivable amounts and avoid discrepancies.

What factors can influence Zara’s promotional methods?

The new target market and a budget of £500.

How does premium pricing work?

Setting high prices to reflect quality and exclusivity in the market.

What is one disadvantage of premium pricing?

It may limit the customer base to only those willing to pay higher prices.

What is liquidity in business terms?

An enterprise's ability to meet short-term obligations comfortably.

What is the formula for calculating liquidity ratio?

Current Assets divided by Current Liabilities.

Define profit in the context of an enterprise.

The difference between total revenue and total costs.

What is a balance sheet?

A snapshot of an enterprise's assets and liabilities at a specific point in time.

What is working capital?

Current assets minus current liabilities, showing liquidity available to the enterprise.

Give an example of a fixed asset.

Buildings or machinery owned by an enterprise.

What does VAT stand for?

Value Added Tax, a tax added to most goods and services.

What is the purpose of a goods received note (GRN)?

To show what goods were actually received and provide a record for warehousing staff.

Why would an enterprise analyze its profit and loss account?

To assess its financial performance over a certain period.

What is one negative impact of a late payment for suppliers?

It can cause cash flow issues and affect operational stability.

What is market segmentation?

The process of dividing a target market into smaller segments based on characteristics.

Define start-up costs.

Expenses incurred to start a business, such as equipment, tools, and registration fees.

What are running costs?

Ongoing costs for operating an enterprise day-to-day, such as rent and utilities.

What is the liquid capital ratio?

Current Assets minus Inventory divided by Current Liabilities.

What are stakeholders?

Individuals or groups with an interest in the enterprise's performance and financial health.

What is the consequence of over-invoicing customers?

It can damage the supplier's reputation and customer trust.

What does B2B stand for?

Business to Business, where businesses sell products or services to other businesses.

List one advantage of using technology in payment methods.

Enhances convenience and speed for customers at sales points.

What is cash flow?

The total cash coming in and going out of an enterprise.

Define advertising budget.

An estimate of costs related to promoting the business and its products.

What is the role of government in relation to financial documents?

To ensure that enterprises are accurately reporting and paying the correct taxes.

Explain the importance of keeping accurate receipts.

They provide proof of payment and are necessary for accounting and auditing purposes.

What can severe variances in budgets indicate?

Potential mismanagement of resources or unexpected market conditions.

How might a limited marketing budget impact an enterprise?

It could restrict the effectiveness and reach of promotional campaigns.

What is an example of a long-term liability?

A mortgage or long-term loan that is due in more than one year.

Describe the importance of profit margins to owners.

They indicate how efficiently an enterprise is operating in terms of profitability.

What role do lenders have concerning an enterprise's balance sheet?

They evaluate the enterprise's financial health and repayment ability before granting credit.

Name one impact of accepting card payments for an enterprise.

It incurs transaction fees which affect profitability.

What does the profit margin tell stakeholders?

It indicates how much profit the enterprise generates per unit of sales.

Give one drawback of cash payments for businesses.

They increase risks of theft and require secure cash management.

What is the significance of the profit and loss account?

It helps stakeholders assess financial performance over a specific period.

What does the term 'net assets' mean?

Total assets minus total liabilities, showing what the owners truly own.

What is an example of a current liability?

Accounts payable or short-term loans.

What is the impact of fraudulent transactions on customers?

It can lead to account freezes and the need for card replacements.

What is an example of a marketing strategy?

Special offers or discounts to increase sales.

Define 'turnover.'

The total revenue generated from sales of goods or services in a specified period.

Explain the benefit of having a diverse payment system for an enterprise.

It attracts more customers by accommodating different preferences.

How can enterprises monitor their budgets effectively?

By implementing budgetary control processes to compare forecasts to actuals.

Name one way enterprises can minimize costs.

By negotiating better terms with suppliers.

What is the main purpose of an invoice?

To formally request payment for goods or services provided.

What does the term 'customer equity' refer to?

The total value of all customers to the enterprise.

Why is it important for enterprises to keep track of their assets?

To understand the resources available and ensure they can meet their obligations.

What is the advantage of operating with a separate capital expenditure budget?

It allows for focused financial planning on large, essential purchases.

Define 'overheads' in business terms.

Fixed costs that do not directly relate to the product or service, such as rent and utilities.

What information is typically included in a statement of account?

All transactions between a buyer and seller, detailing payments and balances.

What does it mean to have a healthy liquidity ratio?

It suggests that the enterprise has sufficient current assets to meet its current liabilities.

Explain how promotional budgets can impact company branding.

A limited or poorly allocated budget may lead to ineffective campaigns that could harm brand perception.

Describe the significance of retaining profits.

Retained profits can be reinvested into the business for growth and expansion.

What is one way successful enterprises continually grow revenue?

By introducing new product lines or services.

What effect do discrepancies in payment processing have on enterprises?

They can lead to cash flow issues and strain supplier relationships.