BTEC UNIT 2: FINANCE FOR BUSINESS - LA C D1

What does a balance sheet show?

• How the money invested in the business has been spent

• The company’s future financial projections

• The company’s marketing strategy

• The company’s employee performance

What is the main goal of businesses?

• To succeed

• To innovate

• To expand

• To diversify

What is the role of cash flow forecasting in business planning?

• To help plan for success

• To determine marketing budgets

• To assess employee performance

• To evaluate product quality

What is the significance of knowing what has happened in a business?

• To make future improvements

• To increase product prices

• To hire more employees

• To reduce marketing efforts

What is net profit?

• The total revenue of a business

• The amount left after all expenses are deducted from gross profit

• The total expenses of a business

• The initial investment in a business

Which of the following is a component of gross profit?

• Expenditure

• Net profit

• Revenue

• Loss

What does a positive net profit indicate?

• Gross profit is negative

• Expenditure is over budget

• Gross profit is positive

• Expenses are too high

What might cause a low or negative net profit?

• High gross profit

• Low expenses

• Low gross profit

• High sales

What is the role of financial statements?

• To summarize marketing strategies

• To summarize financial activities

• To list company products

• To provide employee details

What is the purpose of the government (HMRC) in relation to the income statement?

• To determine market trends

• To assess corporation tax owed

• To evaluate employee performance

• To set sales targets