U5 Entrepreneurs and Finance

Front

What is the primary goal of managing expenses in a business?

Back

To maximize profits

Front

Which of the following is considered a fixed expense? Raw materials, Utilities, Rent, Packaging

Back

Rent

Front

What type of expense changes with the level of production or sales?

Back

Variable expenses

Front

Which of the following is an example of a variable expense in a manufacturing business?
Salaries of permanent staff, Lease payments for equipment, Cost of raw materials, Insurance premiums

Back

Cost of raw materials

Front

Why is it important to distinguish between fixed and variable expenses?

Back

To better forecast and control costs

Front

Which expense is likely to increase if a business decides to produce more units of a product? Options: Rent, Insurance, Raw materials, Salaries of permanent staff

Back

Raw materials

Front

What is a common strategy for managing variable expenses? Options: Negotiating fixed contracts, Increasing production regardless of demand, Adjusting production levels based on demand, Ignoring market trends

Back

Adjusting production levels based on demand

Front

Which of the following is NOT a variable expense? Direct labor costs, Advertising costs, Depreciation, Shipping costs

Back

Depreciation

Front

What is the primary purpose of a cash flow statement?

Back

To track the movement of cash into and out of a business over a specific period.

Front

Which of the following is NOT included in the 'Cash Flow from Operations' section of a cash flow statement?
Options:
Cash received from sales of goods or services.
Cash paid for operational expenses like payroll.
Cash received from investments in new equipment.
Cash paid for inventory purchases.

Back

Cash received from investments in new equipment.