Mind Map by georgechase97, updated more than 1 year ago
Created by georgechase97 over 6 years ago


GCSE Business studies - Unit 8 Finance

Resource summary

1 Balance Sheets
1.1 Where the business has got its money from
1.1.1 Where a business has spent its money
1.2 Produced on an annual basis
1.2.1 At the end of the tax year (April)
1.3 Only shows data about the day that it is produced
1.4 Liabilities - How much money has been borrowed or invested and where this money has come from
1.4.1 Current Liabilities Always changing Short term Creditors Short term loans Overdraft Dividend payments
1.4.2 Long term Liabilities remain Constant Last for a long time Employee wages Long term loans mortgages
1.4.3 More liabilities = less stable business
1.5 Assets - Where the money has been spent
1.5.1 Fixed Assets - what the business actually owns Furniture Machinery Cost a lot, larger investment Last for a long period of time more fixed assets = more stable Hard to turn into cash
1.5.2 Current Assets - Those which the business hold temporarily Constantly changing Stock Work in Progress Debtors Short term can be sold quickly
1.6 All Assets = All Liabilities
1.7 Ratios / Equations
1.7.1 Working Capital Ratio = current assets / current liabilities
1.7.2 Acid Test Ratio = Current Assets - stock / current liabilities
2 Proft and Loss Accounts
2.1 Profit and Loss Account
2.1.1 Part two of three
2.1.2 calculates Net Profit
2.1.3 Profit
2.1.4 Net Profit = Gross Profit - Overheads
2.2 Appropriation Axccount
2.2.1 Calculates retained Profit
2.2.2 Retained Profit = Net Profit befor Tax - Taxations - Dividends
2.2.3 Part three of three
2.3 Trading Account
2.3.1 Calculates Gross profit
2.3.2 Gross Profit = Revenue - Cost of sales
2.3.3 Part 1 of three
2.4 Vital for a business to have a P&L Account
2.5 Reserves - capital brought forward from previous months
3 Why does a business need finance
3.1 To buy resources
3.2 To buy premises
3.3 To pay staff
3.4 To pay off debts
3.5 To pay for promotion
3.6 To transport goods
3.7 To repay loans and mortgages
4 Cashflow Forecast / Statement
4.1 Cash flow Forecast
4.1.1 PREDICTION of how much profit a business will have in upcoming months
4.1.2 Displays all expenditures and income
4.1.3 Displays bank balance at the start and end of every month
4.1.4 Used to predict when a deficit may occur
4.2 Cash Flow statement
Show full summary Hide full summary


Business Studies Unit 1
Unit 1: Business Studies GCSE
Libby Rose
Business Studies Unit 2
Unit 3 Business Studies
Lauren Thrower
AS - Buss1 - Formula Cards
Sophie Davis
Chapter 40: Promotion
Forms of Business Ownership
3.3 Keywords - Effective Financial Management
3.1 Keywords - Marketing
Marketing - Business Studies
GCSE AQA Chemistry 2 Salts & Electrolysis
Lilac Potato