lesson 14
DESCRIPTION
Lesson 14. Topics Covered. Business Costs Revenue Profit Expenditure Break Even Analysis Budgeting Cash Flow Forecast Profit & Loss Account Balance Sheet Maximising Profits. MULTIPLE-CHOICE. - PowerPoint PPT PresentationTRANSCRIPT
Topics Covered
• Business Costs• Revenue• Profit• Expenditure• Break Even Analysis• Budgeting• Cash Flow Forecast• Profit & Loss Account• Balance Sheet• Maximising Profits
MULTIPLE-CHOICE
1) Mark sells 2 bags of Haribo at school for £1.50 each. He bough the sweets on special offer from ASDA for £1 each. Has he made a profit or loss?
MULTIPLE-CHOICE
2) A business sells 300 ice creams at £1 each in one week. It costs £450 to buy the ice creams from the manufacturer.
Profit or loss?
MULTIPLE-CHOICE
3) Sales revenue for a business selling sportswear is at an all time high at £2million for the financial year. However they have incurred costs from a flood at £1million, fixed costs are £200k and insurance premiums have increased to £500 for the year. Has the business made a profit or loss?
MULTIPLE-CHOICE
4) In one day, a bakery sells:
200 doughnuts at £0.50 each
It costs them £85 to manufacture the doughnuts and they have to pay the staff at £20 for one day.
Have they made a profit or a loss?
MULTIPLE-CHOICE
1) Mark sells 2 bags of Haribo at school for £1.50 each. He bought the sweets on special offer from ASDA for £1 each. Has he made a profit or loss?
Profit
MULTIPLE-CHOICE
2) A business sells 300 ice creams at £1 each in one week. It costs £450 to buy the ice creams from the manufacturer.
Profit or loss?
Loss
MULTIPLE-CHOICE
3) Sales revenue for a business selling sportswear is at an all time high at £2million for the financial year. However they have incurred costs from a flood at £1million, fixed costs are £200k and insurance premiums have increased to £500 for the year. Has the business made a profit or loss?
Profit
MULTIPLE-CHOICE4) In one day, a bakery sells:
200 doughnuts at £0.50 each
It costs them £85 to manufacture the doughnuts and they have to pay the staff at £20 for one day.
Have they made a profit or a loss?
Loss
UNIT TITLE: Unit 2:Finance for BusinessLESSON TITLE: Profit & Loss Account LEARNING AIM: C
COMPETENCY FOCUS:
Key Skills (L5): you will be able to develop your numeracy skills to calculate financial transactions of a business and to interpret financial data.
Learning ObjectivesBy the end of the lesson, you should be able to…
LO1) Identify the purpose of a profit & loss account (income statement)
LO2) To complete a profit & loss account from information provided
LO3) To analyse financial statements for a small business and suggest appropriate actions that the business can take to succeed
Competence level Descriptor
Autonomous I can delve deeper into my calculations by fully explaining how my calculations explain the financial state of the business and I will evaluate how effective/ineffective their business activities have been for the organisation and make justified recommendations for improvement.
Advanced As below but additionally I can use my calculations to begin to analyse the activities of my focus organisation and recommend strategies for improvement.
Strong As below but additionally I can fully explain what the calculations show and explain the financial state of the business.
Regular I can correctly input data into a P&L Account, calculate totals and then begin to explain what the calculations show.
Guided Through basic calculations, I can input data correctly into a P&L Account.
I can recognise the layout of the P&L Account, input data correctly and explain what the figures show:
Video Clip
http://www.bbc.co.uk/schools/gcsebitesize/business/finance/accountsvid.shtml
What is a Profit & Loss Account
Often used to take to the Bank Manager when wanting to apply for a loan
Sometimes called the ‘income statement’Show profit/losses over a one year period
Quick Quiz
Which 2 of the following are ways of improving a business’ gross profit?
a)Sell the business to a competitor
b)Reduce the business’ costs
c)Reduce the business’ turnover
d)Reduce productivity
e)Reduce business efficiency
f)Increase productivity
Quick Quiz
Which 2 of the following are ways of improving a business’ gross profit?
a)Sell the business to a competitor
b)Reduce the business’ costs
c)Reduce the business’ turnover
d)Reduce productivity
e)Reduce business efficiency
f)Increase productivity
What is a Profit & Loss Account
There are 3 sections to the P&L account:
-Trading Account
-Profit & Loss Account
-Appropriation Account
What is a Profit & Loss Account
You can see from your revision guide what is included in each section.
Re-cap on P&L Account
a)What is a P&L Account also known as?
b)What is a P&L Account?
c)What are the 3 section of a P&L Account?
UNIT TITLE: Unit 2:Finance for BusinessLESSON TITLE: Profit & Loss Account LEARNING AIM: C
COMPETENCY FOCUS:
Key Skills (L5): you will be able to develop your numeracy skills to calculate financial transactions of a business and to interpret financial data.
Learning ObjectivesBy the end of the lesson, you should be able to…
LO1) Identify the purpose of a profit & loss account (income statement)
LO2) To complete a profit & loss account from information provided
LO3) To analyse financial statements for a small business and suggest appropriate actions that the business can take to succeed
Competence level Descriptor
Autonomous I can delve deeper into my calculations by fully explaining how my calculations explain the financial state of the business and I will evaluate how effective/ineffective their business activities have been for the organisation and make justified recommendations for improvement.
Advanced As below but additionally I can use my calculations to begin to analyse the activities of my focus organisation and recommend strategies for improvement.
Strong As below but additionally I can fully explain what the calculations show and explain the financial state of the business.
Regular I can correctly input data into a P&L Account, calculate totals and then begin to explain what the calculations show.
Guided Through basic calculations, I can input data correctly into a P&L Account.
I can recognise the layout of the P&L Account, input data correctly and explain what the figures show:
TASK 2
You have 20mins to revise theory on Balance Sheets and Profit & Loss Account.
You will now sit a test!
[30mins]