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Note that your final mark will not be saved in the system.
Note that your final mark will not be saved in the system.
3.6.3 - Financial terms and calculations MatchUp
Target Level
4-5
Running Total
0
0%
Attempt
1 of 3
Click on a top box, then click on its match below. Or, drag a top box and drop it onto the correct match. Match all pairs before clicking ‘Check’.
GP = SR – COS
GP = £45,000 – £23,000
GP = £22,000
Note: the answer needs to be expressed in the currency given, i.e. £
NP = GP – expenses + interest
NP = £150 – £25 = £125
Total costs are the same as total revenue
Variable costs might change if the business buys in bulk and the chart doesn't show this
NP = GP – expenses + interest
NP = £70,000 – (£2,000 + £4,000)
NP = £70,000 – £6,000
NP = £64,000
Note: express the answer in the currency given, i.e. £
There is no indication of the length of time it will take to break even, only the total costs and number of units.
The number of units that have to be sold to break even
loss
gross
revenue
Use the gross profit (GP) formula. Phoebe sells cat food in her online shop Smelly Cat, and in 2019 she made £45,000 in sales. The cat food she sold cost her £23,000. Calculate her gross profit.
Chandler sells computer equipment. He has calculated his gross profit to be £70,000 this year. His expenses were £2,000 and his total bank loan interest payments for the year were £4,000. Calculate his net profit.
Ross sells dinosaur toys online. He buys in the toys from China at £300 per box. He calculates his gross profit per box to be £150 and he estimates his expenses and interest to be £25. Calculate the net profit.
Net profit = __________ profit – expenses + interest
Gross profit = sales ___________ – cost of sales
What happens at the point where break even occurs for a business?
What does a break-even chart show?
A potential problem with a break-even chart, related to costs
A weakness with break-even charts related to predicting break even
This is shown below the break-even point on a break-even chart