1.3

• What are the smart objectives?

  Specific

  Measurable

  Achievable

  Realistic

  Timebound
• What are the financial aims and objectives of a business?

  Survival

  profit

  market share

  sales
• What is the meaning of revenue?

  It is the amount of money you earn from selling goods and services.
• Revenue formula?

  Revenue = Price x Quantity
• Difference between fixed and variable costs of a business?

  Fixed- They don't change when your total sales change

  Variable- Change when your total sales change.
• Total cost formula?

  Total cost = fixed cost + variable cost
• What is the cost of interest?

  The cost of interest is the amount of money paid in addition to the principal amount borrowed.
• What is the reward of interest?

  You get money back after you save money in the bank
• Interest formula?

  Total repayment - Borrowed money

  ---------------------------------- x 100

  borrowed money
• What is the breakeven formula?

  FC

  -----

  sc-vc
• What does the margin of safety mean?

  BEP-MOS
• Fomula of margin of safety?

  Actual sales - breakeven point
• What is cash?

  Cash is the money a business has that helps it operate and stop it from insolvency.
• Difference between cash and profit?

  Cash refers to the actual money that a company has on hand, while profit is the amount of money a company earns after deducting expenses from its revenue.
• What is the formula for net cash flow?

  Cash inflow - cash outflow
• Why is a cash flow forecast good?

  It gives a business aims

  helps solve customer payouts
• Why are cash flow forecasts bad?

  Uncertainty
• Why does a business need finance?

  To cover start-up costs?
• What factors effect finance?

  How much needed

  When needed

  how long needed for
• Short term sources of of finance?

  Trade credit - buy now pay later

  bank over draft - informal loan from the bank
• Long-term sources of finance?

  Personal savings - your money put in

  Loan family - friends and family give you money

  Loan bank - bank gives you money with interest

  Venture Capital - Professional investor puts money

  Share capital - shares sold

  Crowdfunding - a group of people who invest

  Retained profit - Use the money from what you made before.
• What are business aims?

  Long-term aspirations of an organization
• What are business objectives?

  Specific, measurable, achievable targets
• Why are aims and objectives important for businesses?

  They align employee efforts towards common goals
• What is an example of a business aim?

  To become the market leader in an industry
• What does SMART stand for in business objectives?

  Specific, Measurable, Achievable, Relevant, Time-bound
• What are common financial objectives for start-ups?

  • Survival in the first year
  • Generating sales revenue
  • Achieving profit
  • Gaining market share
  • Ensuring financial security
• What are common non-financial objectives for start-ups?

  • Social entrepreneurship
  • Personal satisfaction
  • Taking on challenges
  • Independence and control
• Why do business aims and objectives vary?

  They vary due to industry, size, culture, ownership, and location

  
• How does industry influence business objectives?

  Different industries have different primary goals
• How does the size of a business affect its objectives?

  Small businesses focus on survival, large on growth
• How does culture impact business objectives?

  Culture reflects values that shape objectives
• How does ownership structure influence business objectives?

  Family businesses may prioritize stability over profit
• How does geographic location affect business objectives?

  Location influences priorities like innovation or job creation
• What is sales revenue?

  Value of the units sold by a business
• Why is sales revenue important?

  It is a key measure of business performance
• How is sales revenue calculated?

  Sales revenue = Selling price x units sold
• What happens when a firm sells multiple products?

  Calculating sales revenue becomes more complex
• How do computer systems help businesses?

  They track sales revenue for multiple products
• What is the formula for calculating percentage change?

  Percentage change = (new value - old value) / old value x 100