1. true or false. financial planning is needed by small businesses only until they begin to make a profit.
2. the basic financial equation is
D revenue-expenses=profit or loss
3. true or false. a cash budget is an estimate fo the actual money received and paid out for a specific period.
5. a. 85,695-72,624=profit of 13,071
b. 1,824,300-2,183,680= loss of 359,380
c. 729,655-499,220= profit of 230,435
jordyn work
Friday, April 15, 2011
Ch 12 sec 1 Checkpoints
1. what is the basic financial equation for businesses?
revenue-expenses=profit or loss
2. what are the 4 steps in preparing a business budget?
-prepare a list of each type of incomeand expense that will be part of the budget.
-gather accurate information from business records and other info sources for each type of income and expense
-create the budget by calculating each type of income, expense, and the amount of net income or loss
-explain the budget to people who need financial info to make decisions.
3. identify and describe the 3 types of budgets needed by all businesses.
-Start up budget- plans income and expenses form the beginning of a new business
-operating budget – is the money used to operate the business to continue you cash flow
-cash budget- is the actual money received and paid out of a period of time.
revenue-expenses=profit or loss
2. what are the 4 steps in preparing a business budget?
-prepare a list of each type of incomeand expense that will be part of the budget.
-gather accurate information from business records and other info sources for each type of income and expense
-create the budget by calculating each type of income, expense, and the amount of net income or loss
-explain the budget to people who need financial info to make decisions.
3. identify and describe the 3 types of budgets needed by all businesses.
-Start up budget- plans income and expenses form the beginning of a new business
-operating budget – is the money used to operate the business to continue you cash flow
-cash budget- is the actual money received and paid out of a period of time.
Ch 12 sec 1 vocab
1. Revenue – a income that a business receives over a period of time.
2. Expenses- are the cost of operating a business
3. Budget- provides detailed plans for the financial needs of individuals, families, and businesses.
4. Start-up budget – plans income and expenses from beginning of a new business or a major business expansion until it is profitable
5. Operating budget –describes the financial plan for ongoing operations of the business for a specific period
6. Cash budget- is an estimate of the actual money received and paid out for a specific period of time
2. Expenses- are the cost of operating a business
3. Budget- provides detailed plans for the financial needs of individuals, families, and businesses.
4. Start-up budget – plans income and expenses from beginning of a new business or a major business expansion until it is profitable
5. Operating budget –describes the financial plan for ongoing operations of the business for a specific period
6. Cash budget- is an estimate of the actual money received and paid out for a specific period of time
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