IGCSE Business Unit 3 Finance

What is revenue?

• The profit made after all expenses

• The value of units sold by a business over time

• The total costs incurred by a business

• The amount of money invested in the business

Which formula is used to calculate revenue?

• Revenue = Total costs - Profit

• Revenue = Quantity sold x Selling price

• Revenue = Quantity sold + Selling price

• Revenue = Fixed costs + Variable costs

What are fixed costs?

• Costs that do not change with output levels

• Costs that are incurred only when producing goods

• Costs that vary with output

• Costs that are always zero

What is the formula for calculating profit?

• Profit = Fixed Costs + Variable Costs

• Profit = Revenue - Total Costs

• Profit = Revenue + Total Costs

• Profit = Total Costs - Revenue

What does the break-even point represent?

• The point where profit is maximized

• The point where revenue equals total costs

• The point where fixed costs are zero

• The point where total costs exceed revenue

What is the contribution per unit?

• Selling price per unit - Fixed costs

• Selling price per unit - Variable costs per unit

• Total revenue - Total costs

• Total costs - Fixed costs

What is the purpose of a cash flow forecast?

• To predict future sales only

• To estimate cash inflows and outflows

• To calculate total costs

• To determine profit margins

What is a current asset?

• An asset that cannot be converted to cash

• An asset that has no monetary value

• An asset that can be turned into cash within a year

• An asset that is owned for more than a year

What is retained profit?

• Profit distributed to shareholders

• Profit reinvested in the business

• Profit lost in operations

• Profit used to pay off debts

What is an example of a long-term source of finance?

• Supplier credit

• Overdraft

• Trade credit

• Bank loan