## BTEC First Business - Unit 2 - Finance

### Costs, Revenue, Profit and Loss

**Learning Aim A:** Understand the costs involved in business and how businesses make a profit

Businesses spend money and get money in when people buy things. This lets us know if they make a profit or a loss.

The key knowledge here is knowing what the key words mean and how to calculate total costs, total revenue and profit/loss. Note that you need to **know the formulae** - they won't be given to you in the exam...

Note that I've split the slides up a little differently to how I used them in class today. I even added a couple of bits.

Costs PowerPoint - this is a version of the slides I used in class dealing with costs. It covers the key definitions (including the ones I wrote by hand on the board on the Tuesday...)

Revenue Slides - the slides I used in class to deal with the definitions linked to revenue

Revenue calculations - some simple calculations to work through to calculate revenue

Profit/Loss slides - the slides I used in class to teach the definitions and formula for profit and/or loss

Pete's Pickles - some questions to work through to check you understand the differences between fixed and variable costs and how to calculate costs, revenue and profit/loss

### Summary Points

Businesses incur costs. They generate revenue.

By knowing the total costs and total revenue we can work out if a business makes a profit or a loss.

Key Formulae - the three key formulae from this learning aim on one slide

Cost, Revenue, Profit and Loss Specialst Language - the key terms (and a few other useful ones) all on one side of A4

The BBC Bitesize site has some resources for costs, revenue and profit. The revision notes are OK for this. The video linked to this section is a little complex at times, but is worth a look. I'd be interested to hear if you can get to grips with the ideas in it.