AQA A LEVEL BUSINESS STUDIES -
BUSS2 QUESTIONS WITH CORRECT
ANSWERS 2026-2027
Budget - correct answer-
An agreed plan, establishing, in numerical and financial terms, the policy to be pursued and the anticipat
ed outcomes of that policy
SMART - correct answer-How budgets must be:
Specific
Measurable
Agreed
Realistic
Timed
Variance Analysis - correct answer-
The process by which the outcomes of budgets are examined and then compared with the budgeted fig
ures
Favourable Variance - correct answer-
When costs are less than expected, or revenue is more than expected
Adverse Variance - correct answer-
When costs are higher than expected or revenue is lower than expected
Bank Overdraft -Kcorrect answer-
When the holder of a current account is allowed to withdraw more money than is in the account. There
is an agreed maximum
Short-term Loan - correct answer-Money leant from a bankKto be repayed subject to pre-
agreed terms and interest payments
, FactoringK- correct answer-
When a factoring compqany buys the right to collect money from credit sales of an organisation
Sale of Assets - correct answer-
When a business transfers ownership of an item that it owns to another business / individual, usually in
return for cash
Sale and Lease Back - correct answer-
When an asset is sold to provide immediate cash flow and then leased back over a fixed period
Working Capital - correct answer-Day-to-day finance used in a business, consisting of assets - liabilities
Profit - correct answer-The money retained by a business after all costs have been deducted
Profitability - correct answer-The efficiency o a business in generating profit
Net Profit Margin - correct answer-
Measures net profit as a percentage of sales. A high net profit margin is desired
Return on Capital - correct answer-Measures profit in relation to the capital invested in a business
Capital Invested - correct answer-All of the money provided to the business by its owners
Liquidity - correct answer-The ability to convert an asset into cash without loss or delay
Organisational Structure - correct answer-
Relationship between different people and functions in an organisation, both vertically and horizontally
Organisation Chart - correct answer-
A diagram showing the lines of authority and accountability in an organisation
BUSS2 QUESTIONS WITH CORRECT
ANSWERS 2026-2027
Budget - correct answer-
An agreed plan, establishing, in numerical and financial terms, the policy to be pursued and the anticipat
ed outcomes of that policy
SMART - correct answer-How budgets must be:
Specific
Measurable
Agreed
Realistic
Timed
Variance Analysis - correct answer-
The process by which the outcomes of budgets are examined and then compared with the budgeted fig
ures
Favourable Variance - correct answer-
When costs are less than expected, or revenue is more than expected
Adverse Variance - correct answer-
When costs are higher than expected or revenue is lower than expected
Bank Overdraft -Kcorrect answer-
When the holder of a current account is allowed to withdraw more money than is in the account. There
is an agreed maximum
Short-term Loan - correct answer-Money leant from a bankKto be repayed subject to pre-
agreed terms and interest payments
, FactoringK- correct answer-
When a factoring compqany buys the right to collect money from credit sales of an organisation
Sale of Assets - correct answer-
When a business transfers ownership of an item that it owns to another business / individual, usually in
return for cash
Sale and Lease Back - correct answer-
When an asset is sold to provide immediate cash flow and then leased back over a fixed period
Working Capital - correct answer-Day-to-day finance used in a business, consisting of assets - liabilities
Profit - correct answer-The money retained by a business after all costs have been deducted
Profitability - correct answer-The efficiency o a business in generating profit
Net Profit Margin - correct answer-
Measures net profit as a percentage of sales. A high net profit margin is desired
Return on Capital - correct answer-Measures profit in relation to the capital invested in a business
Capital Invested - correct answer-All of the money provided to the business by its owners
Liquidity - correct answer-The ability to convert an asset into cash without loss or delay
Organisational Structure - correct answer-
Relationship between different people and functions in an organisation, both vertically and horizontally
Organisation Chart - correct answer-
A diagram showing the lines of authority and accountability in an organisation
