Question 1: Define the term 'revenue' in the context of a business.

Answer: Revenue is the total amount of money that a business earns from selling its goods or services before any expenses are deducted.

Question 2: List three common sources of income for a small business.

Answer: Sales of products or services, interest income, and rental income.

Question 3: Explain the difference between fixed costs and variable costs with examples.

Answer: Fixed costs are expenses that do not change with the level of production or sales, such as rent or salaries. Variable costs change depending on the amount produced or sold, like raw materials or packaging costs.

Question 4: A business sells 500 items at £10 each. What is the total revenue?

Answer: The total revenue is 500 items x £10 = £5,000.

Question 5: Describe what a profit is in a business context.

Answer: Profit is the money remaining after all expenses, costs, and taxes have been deducted from total revenue.

Question 6: Sketch a simple bar chart that shows the monthly sales revenue for a business over four months. Leave space for the bars and labels.

Answer: A bar chart with four bars representing each month. Each bar's height corresponds to the sales revenue for that month. The x-axis labels the months (e.g., Month 1, Month 2, etc.), and the y-axis shows revenue amounts.

Question 7: Explain why keeping financial records is important for a business.

Answer: Maintaining financial records helps a business track income and expenses, make informed decisions, prepare for taxes, and monitor overall financial health.

Question 8: Imagine you are starting a small business. List three expenses you might have to pay regularly.

Answer: Rent for premises, wages for staff, and cost of raw materials or stock.

Question 9: Draw a simple diagram showing the flow of money in a business from sales to profit. Include labels for sales, expenses, and profit.

Answer: A diagram with arrows showing: Sales money coming in, arrows pointing to expenses (costs), and the remaining amount labeled as profit.

Question 10: What is the purpose of a budget in business finance?

Answer: A budget helps plan and control income and expenses, ensuring the business stays financially healthy and meets its financial goals.