ENTREPRENEURIAL PLANNING
FINANCIAL PLANNING AND ANALYSIS
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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The amount of money a business makes after all expenses have been paid
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Sales revenue-cost of sales
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The amount of money a business makes from sales
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Opening stock + purchases
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Detailed explanation-1: -Gross profit is the difference between net revenue and the cost of goods sold. Total revenue is income from all sales while considering customer returns and discounts. Cost of goods sold is the allocation of expenses required to produce the good or service for sale.
Detailed explanation-2: -Revenue, also known simply as “sales", does not deduct any costs or expenses associated with operating the business. Profit is the amount of income that remains after accounting for all expenses, debts, additional income streams, and operating costs.
Detailed explanation-3: -Sales revenue – The total amount of money earned from the sale of goods/services. Fixed costs – Costs that do not change with the level of business output e.g. rent and salaries. Variable costs – Costs that change with the level of business output e.g. Wages and raw materials.
Detailed explanation-4: -The gross profit of a company is the total sales of the firm minus the total cost of the goods sold. The total sales are all the goods sold by the company. The total cost of the goods sold is the sum of all the variable costs involved in sales.