BTEC Business key terms Level 2
Revenue/ sales - answerThe amount a company earns from selling its products.
Variable costs - answerCosts that can go up or down
Fixed cost - answerCosts that do not vary with the quantity of output produced
Start up cost - answerA cost that has to be paid before the business can start trading
Budgeting - answerFinancial forward planning making sure the business has enough
money to spend on bills or new stock
Trading Profit and Loss account - answerA statement showing if the business has made
or lost money
Break even - answerThe point at which total revenue and total cost are equal. They
business does not make a profit or a loss
Inflow/ sales - answerThe money coming into a business from sales
Outflow/ exspenses - answerThe money that leaves the business, such as paying bills
Gross profit - answerIs the first type of profit made. The business does not keep this
Net profit - answerThe last type of profit made. This business keeps this.
Gross profit calculation - answerSales - cost of sales= ________ profit
Net profit calculation - answerGross profit - expenses = _________ profit
Assets - answerAnything of value that is owned by the business such as a car or stock
Liabilities - answerWhat a business owes to another person or business. For example
payments to a bank
Debtors - answerAn individual or business who has borrowed funds from a business
and so owes it money
Creditor - answerAn individual or business that has lent funds to a business and is owed
money
Interest - answerThe cost of borrowing. Money added onto a loan.
Revenue/ sales - answerThe amount a company earns from selling its products.
Variable costs - answerCosts that can go up or down
Fixed cost - answerCosts that do not vary with the quantity of output produced
Start up cost - answerA cost that has to be paid before the business can start trading
Budgeting - answerFinancial forward planning making sure the business has enough
money to spend on bills or new stock
Trading Profit and Loss account - answerA statement showing if the business has made
or lost money
Break even - answerThe point at which total revenue and total cost are equal. They
business does not make a profit or a loss
Inflow/ sales - answerThe money coming into a business from sales
Outflow/ exspenses - answerThe money that leaves the business, such as paying bills
Gross profit - answerIs the first type of profit made. The business does not keep this
Net profit - answerThe last type of profit made. This business keeps this.
Gross profit calculation - answerSales - cost of sales= ________ profit
Net profit calculation - answerGross profit - expenses = _________ profit
Assets - answerAnything of value that is owned by the business such as a car or stock
Liabilities - answerWhat a business owes to another person or business. For example
payments to a bank
Debtors - answerAn individual or business who has borrowed funds from a business
and so owes it money
Creditor - answerAn individual or business that has lent funds to a business and is owed
money
Interest - answerThe cost of borrowing. Money added onto a loan.
