Business

• Aims and objectives


  The goals of a business. These may be financial or non-financial.
• Breakeven


  The number of products a business must sell so that its total revenue is the same as its total costs. At this point the business will make no profit or loss.
• Cash flow


  The flow of money into and out of a business over a period of time.
• Cash inflow (Receipts)


  Money coming into the business. E.g. Revenue, a loan or another source of finance.
• Cash outflow (Payments)


  Money leaving the business. E.g. Wages, suppliers, loan repayments or advertising.
• Closing balance


  The amount of money left at the end of the current time period.
• Crowdfunding


  Where a large number of individuals invest into a business project on internet sites such as Kickstarter.
• Financial aim


  Aims and objectives that relate to the money. E.g. Survival, profit, sales, market share.
• Fixed cost


  Costs which do not change with output. E.g. Rent or salaries.
• Insolvency


  When a business can no longer afford to pay its debts.
• Margin of safety


  The amount of products a firm sells over and above the breakeven point.
• Net cash flow


  The difference between cash inflows and cash outflows over a period of time.
• Non-financial aim


  Aims and objectives that relate to areas other than finance. E.g. Social objectives, personal satisfaction, challenge and control.
• Opening balance


  The amount of money the business has at the start of the current time period.
• Overdraft


  With agreement from your bank, taking more out of your account than you actually have, leaving a negative bank balance.
• Profit


  The amount left from revenue after costs have been paid.
• Retained profit


  Profit that is 'ploughed back' into the business.
• Revenue


  The money made from selling a product.
• Selling assets


  When a person or business sells assets it owns, such as equipment or vehicles it no longer uses, in order to raise finance.
• Share capital


  A way of raising finance through sale of shares.
• Trade credit


  A period of time given to a customer between receiving the goods and payment being due.
• Variable cost


  A cost which rises as output rises. E.g. Raw materials or packaging.
• Venture capital


  An experienced business person provides funds for small or medium sized companies that may be considered too risky for other investors, in return for equity.