Business IGCSE – Cambridge CIE – Complete Exam Topic Overview and Study Notes Q&A
Total Quality Management is the continuous improvement of products and processes by
focusing on quality at each and every stage of production
Start-up capital the finance needed by a new business to pay for essential non-current and
current assets before it can begin trading
Working capital The finance needed by a business to pay its day to day costs/the capital
available to a business in the short term to pay for day-to-day expenses
Capital expenditure The money spent on non-current assets that will last for more than one
year
Revenue expenditure The money spent on day to day expenses that do not involve the
purchase of a long term asset, for example, wages or rent
Internal finance Finance obtained from within the business itself
External finance Finance obtained from sources outside of and separate from the business
Micro-finance This provides financial services - including small loans - to poor people not
served by traditional banks
Crowdfunding funding a project or venture by raising money from a large number of people
who each contribute a relatively small amount, typically via the internet
Cash Flow the cash inflows and outflows over a period of time
Cash inflows the sums of money received by a business during a period of time
,Cash outflows the sums of money paid out by a business during a period of time
Cash flow cycle this shows the stages between paying out cash for labour, materials, and so
on, and receiving cash from the sale of goods
Profit the surplus after total costs have been subtracted from revenue
Cash flow forecast an estimate of future cash inflows and outflows of a business, usually on
a month-by-month basis. This then shows the expected cash balance at the end of each month
Net Cash flow the difference, each month, between inflows and outflows
Closing bank/cash balance the amount of cash held by the business at the end of each
month, this becomes next month's opening cash balance
Open bank/cash balance the amount of cash held by the business at the start of the month
Accounts the financial records of a business's transactions
Accountants professionally qualified people who have responsibility for keeping accurate
accounts and for producing final accounts
Financial accounts produced at the end of the financial year and give details of the profit or
loss made over the year and the worth of the business
Income statement a financial statement that records the income of a business and all costs
incurred to earn that income over a period of time, it is also known as a profit and loss account
, Cost of sales the cost of producing or buying in the goods actually sold by the business
during a time period
Gross profit made when revenue is greater than the cost of sales
Trading account shows how the gross profit is calculated
Net profit the profit made by a business after all costs have been deducted from revenue, it
is calculated by subtracting overhead costs from gross profits
Depreciation the fall in the value of non-current assets over time
Retained profit the net profit reinvested back into a company after deducting tax and
payments to owners, such as dividends
Statement of financial position shows the value of a business's assets and liabilities at a
particular time
Assets these are items of value that are owned by the business, they may be non-current
assets or current assets
Liabilities these are debts owed by the business, they may be non-current liabilities or
current liabilities
Non-current assets items owned by the business for more than one year
Current assets items that are owned by the business and used within one year
Total Quality Management is the continuous improvement of products and processes by
focusing on quality at each and every stage of production
Start-up capital the finance needed by a new business to pay for essential non-current and
current assets before it can begin trading
Working capital The finance needed by a business to pay its day to day costs/the capital
available to a business in the short term to pay for day-to-day expenses
Capital expenditure The money spent on non-current assets that will last for more than one
year
Revenue expenditure The money spent on day to day expenses that do not involve the
purchase of a long term asset, for example, wages or rent
Internal finance Finance obtained from within the business itself
External finance Finance obtained from sources outside of and separate from the business
Micro-finance This provides financial services - including small loans - to poor people not
served by traditional banks
Crowdfunding funding a project or venture by raising money from a large number of people
who each contribute a relatively small amount, typically via the internet
Cash Flow the cash inflows and outflows over a period of time
Cash inflows the sums of money received by a business during a period of time
,Cash outflows the sums of money paid out by a business during a period of time
Cash flow cycle this shows the stages between paying out cash for labour, materials, and so
on, and receiving cash from the sale of goods
Profit the surplus after total costs have been subtracted from revenue
Cash flow forecast an estimate of future cash inflows and outflows of a business, usually on
a month-by-month basis. This then shows the expected cash balance at the end of each month
Net Cash flow the difference, each month, between inflows and outflows
Closing bank/cash balance the amount of cash held by the business at the end of each
month, this becomes next month's opening cash balance
Open bank/cash balance the amount of cash held by the business at the start of the month
Accounts the financial records of a business's transactions
Accountants professionally qualified people who have responsibility for keeping accurate
accounts and for producing final accounts
Financial accounts produced at the end of the financial year and give details of the profit or
loss made over the year and the worth of the business
Income statement a financial statement that records the income of a business and all costs
incurred to earn that income over a period of time, it is also known as a profit and loss account
, Cost of sales the cost of producing or buying in the goods actually sold by the business
during a time period
Gross profit made when revenue is greater than the cost of sales
Trading account shows how the gross profit is calculated
Net profit the profit made by a business after all costs have been deducted from revenue, it
is calculated by subtracting overhead costs from gross profits
Depreciation the fall in the value of non-current assets over time
Retained profit the net profit reinvested back into a company after deducting tax and
payments to owners, such as dividends
Statement of financial position shows the value of a business's assets and liabilities at a
particular time
Assets these are items of value that are owned by the business, they may be non-current
assets or current assets
Liabilities these are debts owed by the business, they may be non-current liabilities or
current liabilities
Non-current assets items owned by the business for more than one year
Current assets items that are owned by the business and used within one year
