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EnglandBusiness

Finance

5 dot points across 5 inquiry questions. Click any dot point for a focused answer with worked past exam questions where available.

How do businesses manage cash and control spending?

The importance of cash flow and the difference between cash and profit, the construction and interpretation of cash-flow forecasts, the causes of and solutions to cash-flow problems, and the purpose and use of budgets and variance analysis.
A focused answer to the OCR A-Level Business finance theme on cash and budgets, covering the difference between cash and profit, cash-flow forecasts, the causes of and solutions to cash-flow problems, and budgets and variance analysis, with worked calculations.
11 min answer →

How do businesses analyse costs, revenue and the break-even point?

The classification of costs into fixed, variable and total, the calculation of revenue, contribution and profit, break-even analysis and the margin of safety, the construction and interpretation of break-even charts, and the value and limitations of break-even analysis.
A focused answer to the OCR A-Level Business finance theme on costs and break-even, covering fixed, variable and total costs, revenue, contribution and profit, the break-even point and margin of safety, break-even charts, and the value and limitations of break-even analysis.
12 min answer →

What financial goals do businesses set, and how do they raise money?

Financial objectives including profit, cash flow, return and shareholder value, the distinction between internal and external sources of finance, short-term and long-term finance, and the factors that determine the most appropriate source for a given situation.
A focused answer to the OCR A-Level Business finance theme on objectives and funding, covering financial objectives, internal versus external sources of finance, short-term and long-term finance, and the factors that determine the most appropriate source for a situation.
10 min answer →

How do businesses decide whether an investment is worthwhile?

Investment appraisal techniques including the payback period, the average rate of return and net present value, the calculation and interpretation of each, the role of qualitative factors, and the value and limitations of investment appraisal.
A focused answer to the OCR A-Level Business finance theme on investment appraisal, covering the payback period, the average rate of return and net present value, the calculation and interpretation of each, qualitative factors, and the value and limitations of investment appraisal.
13 min answer →

How do businesses measure profitability and financial health?

The income statement and statement of financial position, the calculation and interpretation of profitability ratios (gross and operating margin, ROCE), liquidity ratios (current and acid test) and the gearing ratio, and the value and limitations of ratio analysis.
A focused answer to the OCR A-Level Business finance theme on statements and ratios, covering the income statement and statement of financial position, profitability ratios (gross and operating margin, ROCE), liquidity ratios (current and acid test), the gearing ratio, and the value and limits of ratio analysis.
13 min answer →