RETRIEVAL: Breakeven and Cash Flow Basics

What is the breakeven point?

• The point where total revenue equals total costs

• The point where profit is maximised

• The point where only fixed costs are covered

• The point where cash flow is highest

Which of the following is a fixed cost for a bakery?

• Flour used for baking

• Electricity bill that varies with usage

• Monthly rent for the shop

• Wages paid per loaf baked

• 100 units

• 150 units

• 200 units

• 300 units

Which of the following best describes cash flow?

• The total profit made by a business

• The movement of money into and out of a business

• The amount of money borrowed by a business

• The value of assets owned by a business

A business receives £1,000 from sales, pays £400 in wages, £200 for materials, and £100 for rent in a week. What is the net cash flow for that week?

• £1,000

• £700

• £300

• £500

Which of the following is a variable cost for a clothing manufacturer?

• Factory rent

• Insurance premium

• Fabric used for making clothes

• Annual business rates

Why is cash flow forecasting important for a business?

• It helps to calculate total profit

• It predicts when the business will run out of stock

• It helps to ensure the business can pay its bills on time

• It shows the value of the business’s assets

If a business expects £2,000 in cash inflows and £2,500 in cash outflows next month, what will be the forecasted net cash flow?

• £500 inflow

• £500 outflow

• £4,500 inflow

• £4,500 outflow

Which of the following would NOT be included in a cash flow forecast?

• Predicted sales income

• Expected loan repayments

• Depreciation of equipment

• Anticipated supplier payments

• 40

• 60

• 80

• 120