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Unit 2 - Finance Key Defintions
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- 1Start Up CapitalThe money raised to start the business
- 2Working CapitalThe finance available day-to-day to run the business
- 3AssetThings the business owns
- 4Cash Flow ForecastA prediction of cash inflows and outflows over a future period of time
- 5Cash Flow StatementA document of cash inflows and outflows that have happened
- 6Cash Flow ProblemWhen a business does not have enough cash to be able to pay its liabilities
- 7ExtrapolationUses trends established from historical data to forecast the future
- 8Independent VariableThe factor that causes the dependent variable to change
- 9Dependent VariableThe variable that is influenced by the indpendent variable
- 10DemandThe amount of a product that customers are prepared to buy
- 11RevenuesThe amount of a product that customers actually buy from a firm
- 12CostsAmounts that a business incurs in order to make goods and/or provide services
- 13Variable CostsCosts that change as output varies
- 14Fixed CostsCosts that do not chnage as output varies
- 15ProfitThe reward or return for taking risks and making investments
- 16ContributionThe difference between sales and variable costs to look at the profit made on individual products
- 17Margin of SafetyThe difference between actual output and breakeven output
- 18Corporation TaxTax paid to the government on prfits made by the business
- 19Ratio AnalysisAnalysing relationships between financial data to asses the performance of a business
- 20Gross ProfitThe difference between revenue and cost of sales
- 21Operating ProfitRecords how mcuh profit has been made in total from the trading activities of the business before account is taken of how business is financed
- 22TaxationAn estimate of how much corporation tax that is likely to be payable on the profits for the period
- 23Profit for the YearThe amount of profit that is left after the tax has been accounted for
- 24Administration ExpensesOperating costs and expenses that are not directly related to producing the goods or services are recorded here
- 25LiabilitiesHow much money has been borrowed or invested and where this money has come from
- 26Fixed AssetsAsstes that the business actually owns and which are therfore "fixed" into the company
- 27Current AssetsAssets the business hold temporarily or that are always changing
- 28Current LiabilitiesShort term borrowings or investment and always changing
- 29Share CapitalMoney which shareholders have invested in the business
- 30Liquidity RatiosAsses whether a business has sufficient cash or equivalent current assets to be able to pay its debts as they fall due
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- Descripción
- AS Business - Finance Key Definitions
- Creado por
- Joshua Smith
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