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WorksheetsBusiness 2: Operations, finance and influences on business
Total questions: 100
Worksheet time: 1hrs 20mins
Calculate the revenue:
A business sells 420 products.
Selling price: £5
£420
£2,100
£5
£1,550
Calculate the revenue:
A business sells 800 products.
Selling price: £50
£4,000
£40,000
£50
£750
Calculate the revenue:
A business sells 250 products.
Selling price: £1.75
£437.50
£250
£453.75
£251.75
Rent is an example of a:
Fixed cost
Variable cost
Insurance payment
Gross profit
Stock is an example of a:
Fixed cost
Variable cost
Premium cost
Non-essential cost
Utility bills are an example of a:
Fixed cost
Variable cost
Premium cost
Unavoidable payment
Quantity sold x variable cost per unit =
Total variable cost
Revenue
Profit
Total cost
Fixed costs + variable costs =
Total variable cost
Net profit
Cost of sales
Total costs
A business invests £5,000 in a new machine. It generates £9,000 worth of income over 4 years.
What is the Average Rate of Return?
2%
12%
20%
22%
A business invests £10,000 into a smaller company. It generates £18,000 worth of income over 8 years.
What is the Average Rate of Return?
1%
10%
100%
15%
Calculate the gross profit
£7,000
£4,500
£24,500
£19,500
Calculate the gross profit
£8,000
£4,000
£30,000
£12,000
Calculate the net profit
£17,000
£15,000
£30,000
£7,500
Calculate the net profit
£25,000
£39,000
£83,000
£1,000
Gross profit / Revenue x100 =
Gross profit
Gross profit margin
Total cost of sales
Average rate of return
Net profit / Revenue x100 =
Net profit
Net profit margin
Total revenue
Average rate of return
Calculate the gross profit margin
72%
17%
55%
65%
Calculate the net profit margin
0.6%
60%
5%
50%
Which is NOT an advantage of Job production?
Unique design
Flexible
Large scale production
Meets customers needs
Which type of production requires specialist skills?
Job production
Flow production
Batch production
Which production moves continuously from one stage of the process to the other using large identical items?
Flow production
Batch production
Job production
All of them
Which of the following is a disadvantage of quality control?
Inspectors do not need to be paid
Inspectors are better at checking quality
Inspectors have to be paid which increases costs
Workers do not disrupt production to check their own quality
Which of the following describes quality assurance
Inspectors check the quality of the goods
All workers are responsible for the quality of their own work
Only finished goods are checked for quality
It doesn't disrupt production as quality is only checked at the end
Producing high quality goods always increases sales
True
False
A jewellery manufacturer check each product before dispatching it to the customer. This is an example of:
Good after sales service
Good customer service
Quality assurance
Quality control
A toy shop recalls one if its toys. What is a product recall?
A customer service award for retailers
A face to face sales technique used in small shops
A request by a trader to return a product to the store
An urgent order for items which are currently out of stock
Which of the following is not a benefit to a business of offering excellent after-sales service:
Customer retention
Improved reputation
Reduced market share
Repeat sales
How can you assure the quality of your supplies?
Invest in your technology
Get better equipment
Involve your staff
Make sure their products are good quality
How can inspections help with quality?
To increase wages
To get more supplies
To get better equipment
To check for any defects before the goods leave the business
E-commerce is
Selling goods and from a shop
Selling goods from a warehouse
Selling goods on the internet
Selling goods at the airport
E-Commerce can help a business by
Enabling customers to buy 24/7
Giving advice in store
Making sure goods are up to standard
Taking time to send goods securely
Face to face selling will help a business
When goods being sold are cheap
When service is important
When goods being sold are small
When the customer has a computer
Which of the following is the most likely result of good customer service at Marks & Spencer's?
Increased repeat purchases
Lower profits
Lower margin of safety
Increased cash flows
Which of the following is a form of post sales service?
Training customers how to use the products
Getting the contact details of customers
Providing customer with information about products
Calling customers to gain feedback
When buying any good or service, customers are entitled to expect
The goods to be of the best standard possible
The goods are satisfactory quality
Goods to be guaranteed for 3 years
Good to be the same price as competitors
A way in which a business can be affected by consumer law is
Having compensation claims because goods are high quality
Losing reputation due to defective goods
Having to sack staff who are always late for work
Profits being reduced by paying higher wages
Who does consumer law protect?
Banks that provide finance
Businesses that provide services
Purchasers of products
Suppliers of raw materials
By law, a smart phone manufacturer must make phones which are:
of high quality
made of recycled materials
reasonably priced
safe
Firms that produce small, finished products are best locating near their market
True
False
Governments influence business location to reduce unemployment
True
False
Where a business locates is often influenced by more than one location factor
True
False
Which of the following would be the least important when locating a new hair salon?
Competition
Customers
Staff
Suppliers
A steel works is most likely to be located close to the raw materials it uses because its raw materials are:
expensive to transport
in short supply
of high quality
the business’ largest cost
Which of the following businesses is the most likely to prioritise the location of the market when locating?
Firm selling stationery over the internet
A hairdresser
A courier service
An online travel company
Which of the following is likely to be the main factor influencing the location of a small barber shop? Proximity to:
Customers
Labor
Raw materials
Competitors
The rise of the internet has meant that many businesses costs are:
Lower as there is more need for expensive retail premises
Higher as there is more need for expensive retail premises
Higher as there is less need for expensive retail premises
Lower as there is less need for expensive retail premises
Which of the following businesses is most likely to locate close to the market?
A clothes retailer with a national chain stores
An internet book store
A manufacturer of high performance sports cars
A custom T-shirt warehouse
A new start-up café is most likely to locate close to its:
Competitors
Suppliers
Employees
Customers
What would not affect a businesses decision on location?
Proximity to labour
Proximity to customers
Internet access
Proximity to the government
Procurement is
The process of getting the best quality stock
How a business ensure deliveries are made on time
Process of ordering goods and services needed by the business
Managing the level of production to maximise efficiency
A longer supply chains means
A business has to make do with lower quality goods
It may be more difficult to manage supplies
It will take longer to find the right supplier
The supplier could demand higher prices
Which of these people would work in the procurement department of a clothes manufacturer?
Buyer
Customer service advisor
Delivery driver
Machinist
A business makes jeans. What is the role of its suppliers?
Advertise the jeans
Buy large quantities of jeans
Deliver fabric on time
Pay wages
A business has a long supply chain. This is most likely to lead to:
delays in receiving goods
increased cash inflows
poor internal communications
very little paperwork
Business growth may be limited by problems of raising finance
True
False
Which of the following is a finance function?
Advertising for temporary staff
Decide on the content for a new TV advert
Monitor costs and revenues
Ensure quality production
Which department is responsible for sending out invoices?
Marketing
Operation
Finance
Human Resources
Which of the following tasks is part of the role of the finance function?
Choosing which pricing method to use
Ordering raw materials from suppliers
Paying the wages and salaries of the employees
Providing cash flow information to management
Which of the following is the finance function of a business most likely to be concerned about?
Communication methods used
The cost of running the business
The ethical profile of the business
The reputation of the business
Government funding are called 'Grants'. Why do you think the government will do this? Choose two.
Many governments will offer and give grants to help the entrepreneurs to start and develop their business as this will only help the countries economy.
The government tends to help entrepreneurs to start and develop their business as this will generate work and consolidate the economy.
The government does this to take your business away from you and give it to other big companies.
The government will ask for more money than you were given to increase their profit.
Which of the following is NOT a reason why a business needs money?
To start the business
To expand the business
To deal with negative cash flow
to increase price of products
An advantage that an overdraft has over a bank loan is that:
It has a fixed rate of interest
its is paid back over a fixed time period
the size of the overdraft can vary according to the needs of the business
no dividends have to be paid to shareholders as with a loan
A flower seller plans to increase stocks of plants before a major festival. Which of the following is the most likely source of finance?
bank overdraft
leasing
share issue
debentures
Which of the following sources of finance is most likely to be used by a company planning to take over another business?
Bank overdraft
share issue
leasing
trade credit
Which of the following will probably NOT be considered by a business before deciding on the most suitable source of finance to use?
how long the finance - what will it be used for
how long the finance is used for
the rate of interest on loans
the views of the employees
What is an advantage of a business using owner's capital as a source of finance?
Very low rate of interest
It will bring new skills to the business
It doesn't need repaying
Repayment is always spread over a period time
What type of finance involves less profit going to the owners?
Retained profit
Sale of assets
Overdraft
Owner's capital
What source of finance could lead to an unwanted takeover of the business?
Sale of assets
Owner's capital
Trade credit
Share issue
What source of finance often requires no interest, equity, security or repayment?
Bank loan
Crowdfunding
Taking on a new partner
Overdraft
Which of these sources of finance is likely to charge the most interest?
Trade credit
Retained profit
Bank loan
Overdraft
What source of finance is not available to unlimited companies?
Taking on a new partner
Trade Credit
Share Issue
Retained Profit
Variable costs in a business
Do not change as production increases
Increase as production increases
Stay the same until a certain production level is met
Reduce when a certain level of production is reached
Which flight made the highest revenue?
SK345
SK611
SK212
SK322
If you produce a number of units that is below the break-even point you will...
Make a loss
Make a profit
Make no money at all
What is the margin of safety?
The difference between units sold and the break-even amount
The margin between units and sales
The margin between each break-even point
The margin between profit and loss
A business should know its breakeven point before it starts up. True or False
True
False
A cash flow forecast refers to ......?
Future
Past
Current
In a cash flow forecast, which of the following is true
The opening cash in the first month is the same as the opening cash in the total column.
The closing cash in the first month is the same as the closing cash in the total month
Neither option is correct
Opening cash for Sports Room Ltd is €500 in January their net cash for January is €1000. What is the opening cash for February?
€500
€1000
€1500
An example of an unethical business activity is when a firm buys products made using _________ labour
No
Adult
Child
Free
Another unethical practice would be a firm not providing its workers with a _____________ working environment. For example Amazon at its fulfillment centres.
Child
Pay
Ethics
Safe
Some businesses are not ethical so they can charge ______ for their products
Less
More
Being ethical can bring benefits to businesses...
Higher costs to pay higher wages to workers and providing a safe working environment
Workers trust their employer, increasing motivation, productivity and retention which reduces costs.
Advantage or disadvantage? - There is a greater chance the business will survive in the long run if it is ethical
Advantage
Disadvantage
Advantage or disadvantage? - A business that is honest in its marketing may find that its sales fall.
Disadvantage
Advantage
When income and employment rise, businesses can expect
Sales to rise
Prices to fall
Profits to fall
Immigration to fall
Unemployment measures
the number of people in work
the number of people looking for work
the number of people who cannot work
the number of people who do not work
Which one of the following is most likely to happen if there is a big rise in unemployment.
Government spending on benefits will decrease
More people will be looking for work
People's living standards will increase
There will be an increase in demand for luxury goods
Describe a disadvantage to a business of being a multinational company
Selling in a number of countries can increase sales revenue
They can be liable for higher taxes to import and export goods into other countries
Describe an advantage to a business of being a multinational company
Selling in a number of countries can increase sales revenue
They can be liable for higher taxes to import and export goods into other countries
