BTEC business Finance Proctored Exam Actual Questions And Correct Detailed Answers.

Sales Revenue - correct answer All the money that a business receives (number of sales x price per unit = revenue) Gross Profit - correct answer The money left over once cost of sales has been taken away from revenue (revenue - cost of sales = gross profit) Net Profit - correct answer The money left over once expenditure has been taken away from gross profit (gross profit - expenditure = net profit) Break even point - correct answer When a business has made enough revenue to cover the costs (fixed costs / selling price - variable cost per unit = break-even) Margin of safety - correct answer Is the difference between the target or actual sales and the break even point (target sales - break-even point = margin of safety) Start up cost - correct answer Costs a business only has to pay for once when the business is being set up Running/operating costs - correct answer Costs paid by a business on a regular basis Variable costs - correct answer A cost that varies with the level of output (variable cost per unit x number made/sold = variable costs) Fixed costs - correct answer Costs a business has to pay even if it produces nothing Cashflow - correct answer the total amount of money being transferred into and out of a business, especially as affecting liquidity Direct costs - correct answer Are expenses that directly relate to making a product Indirect costs - correct answer Are costs that can't be directly related to making a product Total costs - correct answer Are all of the business's costs added together (fixed costs + variable costs = total costs or indirect costs + direct costs = total costs) Costs - correct answer Are the money going out of the business Profit - correct answer When revenue is greater than expenditure (revenue - expenditure = profit) Loss - correct answer When expenditure is greater than revenue (revenue - expenditure = loss) Inflows - correct answer Is the money going into the business Outflows - correct answer Is the money going out of the business Cash flow forecast - correct answer A financial record that predicts when money should be coming in and going out of a business Deficit - correct answer Cash flow forecasts tell you when a business might not have enough money to cover its costs Surplus - correct answer Cash flow forecasts tell you when a business might have extra money in their account Closing Bank balance - correct answer the money that a business has in it's account at the end of the month Assets - correct answer What a business owns and what is owed to it. Assets can be fixed or current Budgetary control - correct answer when a predicted budget is compared with actual figures Budget - correct answer A prediction of the money going in and out of a business. This might include a limit of the money spent Capital - correct answer The money that funds a business Capital employed - correct answer All the money that has been invested into a business Cost of sales - correct answer The cost of making or obtaining and selling a product Creditor - correct answer Someone that a business owes money to Debtor - correct answer Someone that owes a business money Expenditure - correct answer All the money that a business spends Income Statement - correct answer A financial record that shows how a business has performed over a period of time Liabilities - correct answer What a business owes to other people or businesses Overheads - correct answer A type of expenditure that needs to be paid even if the business produces nothing Statement of financial position - correct answer A financial record that tells a business what it owns and what it owes to others Variance - correct answer The difference between budgeted financial figures and actual figures Working capital - correct answer The money available to pay for the day-to-day costs of running a business (current assets - current liabilities = working capital) Net assets - correct answer Shows the money the business would make if it sold all its assets (fixed assets + working capital = net a