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2.4.1 Business calculations - Match-up

Match-up definitions and answers with key terms and examples. Press submit to check your answers.

Sales revenue
Fixed costs
Variable costs
Total costs
Profit
Cost of sales
Gross profit
Gross profit margin
Net profit
Net profit margin
Average rate of return
Average annual profit


Answers
Income from sales: price multiplied by quantity sold.
Sum of fixed and variable costs for producing goods or services.
Direct costs of producing goods sold; also called cost of goods sold.
Residual income after subtracting total costs from sales revenue.
Costs that change with output, such as materials and production labour.
Net profit divided by sales revenue, multiplied by 100 to show percentage.
Project profitability: average annual profit divided by initial cost, shown as percent.
Costs that do not change with output, e.g., rent or salaries.
Gross profit minus operating expenses and interest; actual retained profit.
Total profit over project divided by number of years.
Sales revenue minus cost of sales; core product profitability measure.
Gross profit divided by sales revenue, multiplied by 100 to show percentage.
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