COMPONENT 3 | REVISION BTEC Enterprise HOOK – WHAT
Description: COMPONENT 3 REVISION BTEC Enterprise HOOK WHAT AM I? Read the description and state what it explains: I am a form of promotion which gives a customer an incentive to buy a product (BOGOF) I am a market where an enterprise will sell
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slide1. COMPONENT 3 | REVISION BTEC Enterprise<br>
slide2. HOOK – WHAT AM I? Read the description and state what it explains:
I am a form of promotion which gives a customer an incentive to buy a product (BOGOF)
I am a market where an enterprise will sell goods/services to other enterprises.
I am net cash flow + opening balance
I am the line which is diagonal starting from the fixed costs line on a break even chart
I am an external source of finance given by a bank which will be paid back with interest
I am a gross profit divided by sales x100
I am a liquidity ratio that removes inventory from current assets<br>
slide3. 1. PROMOTIONAL MIX There are 5 key elements of the promotional mix
What are they?
Can you briefly explain what they are?
What are the advantages and disadvantages of each?
What factors will impact the choice of promotion used?
Complete the table in your student handbook<br>
slide4. EXAM STYLE QUESTION – FEB 2019<br>
slide5. MARKET SEGMENTATION As a group, create a spider diagram of the key terms that come to mind when you think of market segmentation<br>
slide6. SEGMENTATION KNOWLEDGE CHECK What is meant by the term market segmentation?
Identify and explain one benefit of segmentation.
What sort of products might be segmented based on age?
What is meant by psychographic segmentation?
Why would a business want to choose a target market?<br>
slide7. EXAM STYLE QUESTION<br>
slide8. KEY FINANCIAL DOCUMENTS Buyers Sellers Can we buy… Can you pay please? Record of payment Here’s your money back Account summary<br>
slide9. KEY FINANCIAL DOCUMENTS Buyers Sellers Purchase Order Statement of Account Credit Note Receipt Invoice Can we buy… Can you pay please? Record of payment Here’s your money back Account summary<br>
slide10. FINANCIAL DOCUMENTS | PAYMENT METHODS KNOWLEDGE CHECK What is a purchase order used for?
What is an invoice used for?
Why is it important for the seller to send the buyer a statement of account document?
State and explain 2 types of payment methods
What is meant by the term surcharge?<br>
slide11. EXAM STYLE QUESTION – MAY 2019<br>
slide12. FINANCIAL TERMINOLOGY Revenue Profit Variable
Costs Fixed
Costs Capital Net
Profit Gross
Profit What is meant by each of the terms below?
Complete the key term section in your student handbook<br>
slide13. FINANCIAL TERMINOLOGY Write the formula for the following:
Revenue
Total variable costs
Total costs
Profit
Distinguish between fixed and variable costs (use an example to support)<br>
slide14. EXAM TIPS Ensure that when calculating total costs you first of all calculate the total variable costs.
There will always be a downside to decisions taken by a firm to try and improve their level of profit:
Increase selling price = decrease in demand
Reduce variable costs = drop in quality
Reduce managers salaries = drop in motivation/output
If the question is analyse/assess you must consider these<br>
slide15. ASSETS AND LIABILITIES Use the following definitions and terms to complete the table in your student handbook Kept by the business for more than 1 year Turned into cash within a year Debts that the business has more than 1 year to pay Debts that have to be paid within 1 year Vehicles Premises Machinery Bank Loans Mortgages Inventories Receivables Cash Overdrafts Payables<br>
slide16. STATEMENT OF COMPREHENSIVE INCOME KNOWLEDGE CHECK What is the layout of a statement of comprehensive income?
What is the formula for gross profit?
What is the formula for net profit?
Identify 2 ways a business could improve their gross profit?
Complete the statement of comprehensive income<br>
slide17. EXAM TIPS The statement of comprehensive income shows an historic view of the financial performance
You must be able to identify why profit levels have gone up/down and how the business could react.
It is common that you may have to amend some figures and then recalculate<br>
slide18. PROFITABILITY AND LIQUIDITY KNOWLEDGE CHECK What is meant by the term profitability?
What are the 2 profitability ratios?
What is meant by the term liquidity?
What are the 2 liquidity ratios?
Which year did the business perform best?<br>
slide19. EXAM STYLE QUESTION – MAY 2019 Complete the statement of financial position and then calculate the 2 liquidity ratios for Tyler.
Answer the qualitative question below<br>
slide20. CASH FLOW FORECASTING KNOWLEDGE CHECK Write the formula for the following:
Net cash flow
Opening Balance
Closing Balance
What are the advantages and disadvantages of cash flow forecasting?<br>
slide21. EXTEND YOUR UNDERSTANDING Using the advantages and disadvantages you have come up with previously, create 1 paragraph showing a chain of analysis for an exam style question
Create a spider diagram of the different ways a business can improve their cash flow<br>
slide22. EXAM STYLE QUESTION – FEB 2019<br>
slide23. EXAM TIPS Cash flow is not the same as profit
If a business is suffering negative cash flow for a short period of time, this is not the end of the world
However, if it continues it may to consider options to improve it’s cash flow. How can a business improve their cash flow?<br>
slide24. BREAK EVEN KNOWLEDGE CHECK What is the formula for break even?
What 2 things will be the same when a business is breaking even?
What lines should be drawn on a break even chart?
What are the labels on the axis on a break even chart?
What would happen to the break even point in each of the following scenarios:
A decrease in variable cost per unit
An increase in selling price
A decrease in fixed costs?<br>
slide25. EXAM STYLE QUESTION Complete the break even calculations in the student handbook
Complete the cost and revenue table then use this data to complete the break even chart<br>
slide26. SOURCES OF FINANCE KNOWLEDGE CHECK Create a spider diagram of the different sources of finance including:
A brief definition
Internal or External
An advantage
A disadvantage
Choose the most appropriate source of finance for the scenarios<br>
slide27. EXAM STYLE QUESTION<br>
slide28. EXAM TIPS Not all firms will have access to the same sources of finance:
Only limited companies will be able to make use of share capital
Consider how mature the business is:
What source of finance will a new business not have access to?
Will financial organisations be more/less willing to offer finance to established firms?<br>
slide29. IMPORTANT INFORMATION Promotion and Finance Examination Monday 3rd February
Learning Commons at 8.30 Â
Exam is 2 hours long
PLEASE ENSURE YOU HAVE THE FOLLOWING:
Pens
Pencils
Calculator
Ruler
Rubber
Highlighter<br>
slide30. IMPORTANT INFORMATION For quantitative questions, you MUST:
Formula
Workings
Answer with units
Use a pencil for break even charts and cash flow forecasts<br>
slide2. HOOK – WHAT AM I? Read the description and state what it explains:
I am a form of promotion which gives a customer an incentive to buy a product (BOGOF)
I am a market where an enterprise will sell goods/services to other enterprises.
I am net cash flow + opening balance
I am the line which is diagonal starting from the fixed costs line on a break even chart
I am an external source of finance given by a bank which will be paid back with interest
I am a gross profit divided by sales x100
I am a liquidity ratio that removes inventory from current assets<br>
slide3. 1. PROMOTIONAL MIX There are 5 key elements of the promotional mix
What are they?
Can you briefly explain what they are?
What are the advantages and disadvantages of each?
What factors will impact the choice of promotion used?
Complete the table in your student handbook<br>
slide4. EXAM STYLE QUESTION – FEB 2019<br>
slide5. MARKET SEGMENTATION As a group, create a spider diagram of the key terms that come to mind when you think of market segmentation<br>
slide6. SEGMENTATION KNOWLEDGE CHECK What is meant by the term market segmentation?
Identify and explain one benefit of segmentation.
What sort of products might be segmented based on age?
What is meant by psychographic segmentation?
Why would a business want to choose a target market?<br>
slide7. EXAM STYLE QUESTION<br>
slide8. KEY FINANCIAL DOCUMENTS Buyers Sellers Can we buy… Can you pay please? Record of payment Here’s your money back Account summary<br>
slide9. KEY FINANCIAL DOCUMENTS Buyers Sellers Purchase Order Statement of Account Credit Note Receipt Invoice Can we buy… Can you pay please? Record of payment Here’s your money back Account summary<br>
slide10. FINANCIAL DOCUMENTS | PAYMENT METHODS KNOWLEDGE CHECK What is a purchase order used for?
What is an invoice used for?
Why is it important for the seller to send the buyer a statement of account document?
State and explain 2 types of payment methods
What is meant by the term surcharge?<br>
slide11. EXAM STYLE QUESTION – MAY 2019<br>
slide12. FINANCIAL TERMINOLOGY Revenue Profit Variable
Costs Fixed
Costs Capital Net
Profit Gross
Profit What is meant by each of the terms below?
Complete the key term section in your student handbook<br>
slide13. FINANCIAL TERMINOLOGY Write the formula for the following:
Revenue
Total variable costs
Total costs
Profit
Distinguish between fixed and variable costs (use an example to support)<br>
slide14. EXAM TIPS Ensure that when calculating total costs you first of all calculate the total variable costs.
There will always be a downside to decisions taken by a firm to try and improve their level of profit:
Increase selling price = decrease in demand
Reduce variable costs = drop in quality
Reduce managers salaries = drop in motivation/output
If the question is analyse/assess you must consider these<br>
slide15. ASSETS AND LIABILITIES Use the following definitions and terms to complete the table in your student handbook Kept by the business for more than 1 year Turned into cash within a year Debts that the business has more than 1 year to pay Debts that have to be paid within 1 year Vehicles Premises Machinery Bank Loans Mortgages Inventories Receivables Cash Overdrafts Payables<br>
slide16. STATEMENT OF COMPREHENSIVE INCOME KNOWLEDGE CHECK What is the layout of a statement of comprehensive income?
What is the formula for gross profit?
What is the formula for net profit?
Identify 2 ways a business could improve their gross profit?
Complete the statement of comprehensive income<br>
slide17. EXAM TIPS The statement of comprehensive income shows an historic view of the financial performance
You must be able to identify why profit levels have gone up/down and how the business could react.
It is common that you may have to amend some figures and then recalculate<br>
slide18. PROFITABILITY AND LIQUIDITY KNOWLEDGE CHECK What is meant by the term profitability?
What are the 2 profitability ratios?
What is meant by the term liquidity?
What are the 2 liquidity ratios?
Which year did the business perform best?<br>
slide19. EXAM STYLE QUESTION – MAY 2019 Complete the statement of financial position and then calculate the 2 liquidity ratios for Tyler.
Answer the qualitative question below<br>
slide20. CASH FLOW FORECASTING KNOWLEDGE CHECK Write the formula for the following:
Net cash flow
Opening Balance
Closing Balance
What are the advantages and disadvantages of cash flow forecasting?<br>
slide21. EXTEND YOUR UNDERSTANDING Using the advantages and disadvantages you have come up with previously, create 1 paragraph showing a chain of analysis for an exam style question
Create a spider diagram of the different ways a business can improve their cash flow<br>
slide22. EXAM STYLE QUESTION – FEB 2019<br>
slide23. EXAM TIPS Cash flow is not the same as profit
If a business is suffering negative cash flow for a short period of time, this is not the end of the world
However, if it continues it may to consider options to improve it’s cash flow. How can a business improve their cash flow?<br>
slide24. BREAK EVEN KNOWLEDGE CHECK What is the formula for break even?
What 2 things will be the same when a business is breaking even?
What lines should be drawn on a break even chart?
What are the labels on the axis on a break even chart?
What would happen to the break even point in each of the following scenarios:
A decrease in variable cost per unit
An increase in selling price
A decrease in fixed costs?<br>
slide25. EXAM STYLE QUESTION Complete the break even calculations in the student handbook
Complete the cost and revenue table then use this data to complete the break even chart<br>
slide26. SOURCES OF FINANCE KNOWLEDGE CHECK Create a spider diagram of the different sources of finance including:
A brief definition
Internal or External
An advantage
A disadvantage
Choose the most appropriate source of finance for the scenarios<br>
slide27. EXAM STYLE QUESTION<br>
slide28. EXAM TIPS Not all firms will have access to the same sources of finance:
Only limited companies will be able to make use of share capital
Consider how mature the business is:
What source of finance will a new business not have access to?
Will financial organisations be more/less willing to offer finance to established firms?<br>
slide29. IMPORTANT INFORMATION Promotion and Finance Examination Monday 3rd February
Learning Commons at 8.30 Â
Exam is 2 hours long
PLEASE ENSURE YOU HAVE THE FOLLOWING:
Pens
Pencils
Calculator
Ruler
Rubber
Highlighter<br>
slide30. IMPORTANT INFORMATION For quantitative questions, you MUST:
Formula
Workings
Answer with units
Use a pencil for break even charts and cash flow forecasts<br>