Quiz on Investigating Small Businesses

What is the primary aim for any new business in the first 12-48 months?

• To gain independence

• To achieve financial security

• To survive

• To maximize market share

What is the term for the money generated from sales?

• Profit

• Net income

• Revenue

• Cash flow

Which of the following is a fixed cost?

• Wages

• Raw materials

• Utility bills

• Rent

What is the formula for calculating profit?

• Revenue - Fixed Costs

• Revenue - Variable Costs

• Revenue - Operating Costs

• Revenue - Total Costs

What does the break-even point represent?

• The point where fixed costs are covered

• The point where revenue equals total costs

• The point where total costs are minimized

• The point where profit is maximized

What is the formula for calculating break-even output?

• Fixed Costs / Variable Costs

• Revenue / Fixed Costs

• Fixed Costs / Contribution per Unit

• Total Costs / Contribution per Unit

What is the term for the difference between actual output and break-even output?

• Break-even margin

• Profit margin

• Margin of safety

• Safety margin

What is the term for the immediate spending power of a business?

• Profit

• Revenue

• Cash

• Net income

What is the term for the failure of a business due to running out of cash?

• Foreclosure

• Bankruptcy

• Insolvency

• Liquidation

What is a cash flow forecast?

• A projection of profit for the future

• A projection of revenue for the future

• A projection of costs for the future

• A projection of cash flows for the future