ent ch 7 – Flashcards
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receipts and invoices
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Record keeping for a very small business can be accomplished by a journal and two boxes for storing ________.
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2,700
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Carla sells hot coffee, cider and tea from a sidewalk cart near Wall Street in New York City. Last month she sold $4,500 worth of product to 1,000 customers. She spent $800 on buying her beverages in bulk. Her monthly costs are: Utilities = $100, Salary = $2,000, Advertising = $0, Insurance = $0, Interest = $0, Rent (cart) = $600, Depreciation = $0. What are Carla's fixed costs?
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3 months of fixed operating costs / one half of the start-up investment
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You should keep reserves of at least ________ and ________.
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all of the above
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Entrepreneurs use the following financial statements to run their business:
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right side
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On which section of the accounting journal is the matching entry entered?
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cost of goods sold and other variable costs
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there are two categories of variable costs ________.
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prototype
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A ________ is a model or pattern that serves as an example of how a product would look and operate if it were manufactured
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speed capital
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Start-up investment is the one-time expense of opening a business. It is also called ________.
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total costs of goods sold
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Total Revenue - ________ = Total Gross Profit
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a check provides written proof of payment
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Why is it best to pay expenses for your business with a check, not with cash?
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fixed and variable
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Which two categories below are used for business costs?
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$800
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Using the information from the exercise above, what is Carla's monthly cost of goods sold?
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fixed opperating costs
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Overhead is another term for ________
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assembly line production
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What business concept did Henry Ford introduced that forever changed American industry?
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hour
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An example of a service business's unit of sale would be one ________ of service.
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net profit/investment
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ROI tells you the rate of return of your capital investment in the business. You calculate it by ________.
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all of the above.
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Business start-up cost information can be obtained from ________.
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100
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To express ROI as a percentage, multiply the result of the calculation by ________.
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contribution margin per unit
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Other variable costs per unit subtracted from Total COGS per unit equals ________.
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3220
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If a business has total gross profit of $14,720 and total operating costs of $11,500, what is its total profit?
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40
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If a business sells 5,000 units for a total profit of $200,000, what is its profit per unit?
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capital
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Which of the following is not a category of fixed costs?
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prototypes
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The Thomas Register of American Manufacturers lists companies that specialize in creating ________.
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inflation
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________ is the general rise in the price of goods and service in an economy.
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fixed and variable
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Which two categories below are used for business costs?
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payback
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________ will tell you how long it will take you to earn enough profit to cover your start-up investment
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10
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A suggested allowance for contingencies and emergencies at start-up is ________ percent of estimated start-up costs
