What is the purpose of the margin of safety?
- It allows business to calculate the difference between variable costs and fixed costs
- It allows a business to identify how many more sales it must make before it reaches profitability
- It allows business to identify how far sales can fall before a loss is made
- It allows a business to calculate the gap between sales output and total costs
When a business spends money to become more profitable, it is known as…
- Paying dividends
- Investment
- Profit share
- Commission
Which of the following is a disadvantage of calculating the annual rate of return?
- The entire investment period is used
- It does not consider inflation
- It provides an easy-to-compare percentage value
- A simple comparison of investments can be made
What financial document summarises a company's revenues, costs, and expenses over a specific period?
- Balance Sheet
- Income Statement
- Cash Flow Statement
- Statement of Retained Earnings
The gap between the break-even point and the businesses current output is called…
- …the margin of safety
- …a balance sheet
- …liquidity
- …the break-even point
Which factors should a business consider when choosing finance options?
- Cost, timescales, amount to be borrowed, and the size and type of their business
- Specific, measureable, achievable, realisitic, time-bound
- Personal savings, loans, government grants, credit, share issues, and crowd funding
- Profit, revenue, fixed costs, and variable costs
Which of the following is not shown on an income statement?
- Revenue
- Costs
- Share value
- Profit
The Acme Spring and Dynamite Company buys 400 pogo sticks for £4000 and sells each one for £35. How much is the total profit?
A "statement of financial position" is also know as…
- A balance sheet
- Income statement
- Boston Matrix
- Product lifecycle
Which of the following is a current liability?
- A mortgage
- Leasing a vehicle
- Bank loan
- Staff wages
