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Worksheetsbreak-even
Total questions: 19
Worksheet time: 11mins
When a business has made enough money to pay its costs and begin to make a profit, it has reached its
break-even point
variable-cost margin
fixed cost
selling price
If a business's sales double, its variable costs will also likely
remain the same
decrease
increase
double
It may be difficult for a new business to predict its variable costs because new businesses
are sometimes short of working capital
don't have access to industry figures
may have inexperienced employees
don't have past sales records
Most businesses receive the bulk of their income from
dividends
sales revenue
return on investment
capital
A business that does not reach break-even will
go bankrupt
have profit and loss
lose money
need to relocate
Revenue is...
the income earned by a business over a period of time
the income minus expenses
the Gross Profit made
the Net Profit made
the total revenue raised by selling 20 items priced £10 each is...
£200
£20
£30
£220
Costs are
All expenses involved in making a product.
what the products cost to buy
the expenses
the cost of sales
Costs that stay the same, no matter how much produced are...
Fixed Costs
Variable Costs
Costs that change with the amount produced...
Fixed Costs
Variable Costs
Rent
Fixed Cost
Variable Cost
Total costs are
Fixed Costs - Variable Costs
Fixed Costs X Variable Costs
Fixed Costs / Variable Costs
Fixed Costs + Variable Costs
Salary wages for permanent workers
Fixed Cost
Variable Cost
The formula to calculate revenue is:
REVENUE = FIXED COSTS + VARIABLE COSTS
REVENUE = VARIABLE COSTS * PRICE
REVENUE = UNITS SOLD * PRICE
REVENUE = UNITS SOLD * TOTAL COSTS
What is represented by the orange region in the break even diagram shown here?
The break even point
Profit
Loss
What is represented by the purple region in the break even diagram shown here?
The break even point
Profit
Loss
At a local concert hall, the owner charges £7 per ticket. The owner must pay his band £1200. Every customer receives a brochure that costs the owner £2 for each person.
How many people must attend for him to breakeven?
240 people
170 people
600 people
133 people
