Learning objective
Explain revenue, costs, profit and loss.
Read the explanation, check the common trap, then practise with flashcards and questions.
At a glance
0
Flashcards
0
Questions
Topic
Financial terms and calculations
Subtopic
Costs, revenue, profit and loss
Study support
Understand this objective
Quick explanation
Explain revenue, costs, profit and loss
- This point belongs to Financial terms and calculations, especially Costs, revenue, profit and loss.
- You need to be able to explain revenue, costs, profit and loss.
- The key ideas to know are revenue, loss, and profit.
- Use the linked flashcards and practice questions to check recall, then practise applying the idea in an exam-style answer.
Key concepts
Why it matters
This objective helps connect Costs, revenue, profit and loss to exam-style questions, flashcards, and revision notes for Financial terms and calculations.
Quick student answer
A retailer has revenue of £12,500 and total costs of £9,200. Calculate the profit and state whether the business is profitable.
Direct answer
£3,300 profit; the business is profitable.
How it works
Profit = £12,500 – £9,200 = £3,300. Because profit is positive, the business is profitable.
Key terms
- Profit: The amount remaining after all costs have been deducted from revenue; it represents the business's earnings.
Common trap
Mixing up revenue and profit: Revenue is the total sales income; profit is revenue minus all costs.
Related questions
Try this as a practice card
Question 1 of 1
Choose an answer, get feedback, then move sideways through the set.
Flashcard prompts
Flip through the key recall cards
Flashcard 1 of 2
Practise next
Revision tools
Choose how to practise
Flashcards0 linked cards
Practice Questions0 linked questions
Revision notestopic notes
Open the full topic revision notes when you are ready to review this objective in context.
Open revision notesRelated learning objectives
- Distinguish variable costs, fixed costs and total costs.
Costs, revenue, profit and loss
- Explain investment projects such as investment in machinery, buildings and vehicles.
Average rate of return
- Calculate average rate of return for business investment projects.
Average rate of return
- Explain break-even output.
Break-even
- Interpret break-even charts.
Break-even