2.4 Making financial decisions

Gross profit is the __________ a company makes after deducting the ______ associated with making and selling its products.

• Profit, Costs

• Costs, Profits

• Money, Costs

• Profit, Profit

Definition of net profit?

• The costs of a company after operating expenses and all other charges including taxes, interest and depreciation have been deducted from total revenue

• The profit of a company after operating expenses and all other charges including taxes, interest and depreciation have been deducted from total revenue

• The revenue of a company after operating expenses and all other charges including taxes, interest and depreciation have been deducted from total revenue

• The sales of a company after operating expenses and all other charges including taxes, interest and depreciation have been deducted from total revenue

The Average Rate of Return or ARR, measures the ____________ of the investments on the basis of the information taken from the financial statements rather than the cash flows.

• Profit

• Losses

• Profitability

• Sales revenue

Profit before tax (PBT) is a measure that looks at a company's profits before the company has to pay corporate __________ ______

• All costs

• V.A.T

• Corporation tax

• Income Tax

A business can increase profits in two ways, firstly by increasing revenue and secondly...?

• Raising costs

• Lowering costs

• Raising prices

• Improving on customer service levels

Profit = total revenue - _______?

• Total costs

• Fixed costs

• Variable costs

• All costs

Two methods of increasing profit?

• Lower costs and increase revenue

• Lower costs and increase gross profit

• Lower fixed costs and increase revenue

• Lower revenue and increase costs

Businesses have two types of profit, name them both?

• Gross and FIxed

• Maximise and Gross

• Net and Variable

• Gross and Net

Sales revenue - Cost of sales?

• Profit

• Net profit

• Gross profit

• Variable costs

Cost of sales is the ....................total of all costs to make the product or service?

• Divided

• Some

• Added

• Accumulated