2.4 Making Financial Decisions

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Cards (8)

  • Gross Profit - Revenue - Variable costs.
  • Gross Profit is how much the product and its sales made, not including business overheads.
  • Gross Profit margin - Gross Profit / revenue * 100
  • Net Profit - is the total profit after total costs
  • Net Profit Margin - Net Profit / Revenue * 100
  • Average Rate of Return (ARR) - the average annual profit on an investment e.g. machinery
  • ARR - Average Annual Profit / Inital Capital outlay(invenstment) *100
  • Marketing data - data that is collected to help a business understand its customers and their needs. this comes in the form of surveys, focus groups, and questionnaires.