Investigating A Small Business Flashcards
(26 cards)
Whats an entrepreneur?
A person who owns and runs their own business. Entrepreneurs are risktakers, who have an initial idea and the willingness and confidence to see it through
4 ways to add value?
- USP
- Quality
- Packaging
- Branding
3 skills and entrepreneur needs?
- Risky
- Showing initiative
- willingness to undertake a new venture
4 customer needs?
- PRICE
- Choice (product range)
- Quality
- Convineince
What is a breakeven point?
A breakeven point is the level of output at which a business revenue covers its total costs. At this point the business is making neither a loss nor a profit breakeven is an important financial concept as it allows a business to make important financial decisions.
What is a margin of safety?
A margin of safety is the amount of output between the actual level of output where profit is being made and the breakeven level of output this is how much production could fall before the business starts to make a loss.
What is a bank overdraft?
short/long term
Short term
When the bank allows its customer to go into the minus numbers in their bank account.
What is trade credit?
short/long term
Short term
Paying for goods or stock later than when they bought it.
What is personal savings?
short/long term
Long term
The money a business owner has saved up.
What is venture capital?
short/long term
Long term
When a business owner shares the business idea with the venture capital list and they give the money in return for a large share of the business.
What is share capital.
short/long term
Long term
Capital raised from selling shares in the business
What is a loan?
short/long term
Long term
Borrowing money from my bank and paying you back slowly but with an interest on top of it.
What is retained profit?
short/long term
Long term
Profit gained in the business that hasn’t yet been reinvested.
What is crowd funding?
short/long term
Long term
When a business owner, normally online, shares their business idea and the public give them money usually in return for some sort of reward.
How to calculate receipts/net cash flow/total payments
Receipts = net cash flow + total payments
Total payments = receipts - net cash flow
Net cash flow = receipts- total payments
How to calculate opening balance?
The closing balance of the previous month
How to calculate closing balance/opening balance/net cash flow?
Closing balance = net cash flow + opening balance
Opening balance = closing balance - net cash flow
Net cash flow= closing balance - opening balance
Does a sole trader have limited or unlimited liability?
Unlimited liability
Does a partnership have limited or unlimited liability?
Unlimited liability
Does a private limited company have limited or unlimited liability?
Limited liability
Is a public limited company have limited or unlimited liability?
Limited liability
What does LTD stand for?
Private limited company
What does PLC stand for?
Public limited company
Who is the franchisor?
The business that gives the franchisees the right to sell its product or service.
