1.3 - Understanding Business Aims and Costs

What are the goals that a business sets itself over a period of time called?

• Objectives

• Aims

• Targets

• Strategies

Which of the following is a financial aim or objective?

• Increasing customer satisfaction

• Reducing carbon footprint

• Maximising profit

• Improving employee morale

What are costs incurred before the business is running known as?

• Running costs

• Fixed costs

• Start-up costs

• Variable costs

Which type of cost does not vary with the output produced?

• Variable costs

• Fixed costs

• Total costs

• Running costs

What is the term for the amount of income received from selling goods or services?

• Revenue

• Profit

• Cost

• Price

What is the difference between total revenue and total cost called?

• Loss

• Profit

• Interest

• Contribution

What is the level of output where total revenue equals total costs?

• Margin of safety

• Break-even point

• Contribution analysis

• Cash flow

Which of the following is a prediction of how cash will flow through a business in the future?

• Cash flow statement

• Cash inflow

• Cash flow forecast

• Cash outflow

What is the term for the cash flowing into a business?

• Cash outflow

• Cash inflow

• Cash flow statement

• Cash flow forecast

What is the reward for lending and the cost of borrowing called?

• Interest

• Profit

• Revenue

• Contribution