CCEA A-Level Business Studies AS 2 Growing the Business overview quiz quiz

Growth from within the firm, such as selling more or opening new outlets

Growth achieved by taking over a competitor in the same industry

Growth achieved by merging with a firm in an unrelated industry

Growth achieved by buying a supplier further up the chain

Horizontal integration with a rival brewery

Conglomerate integration into an unrelated market

Forward vertical integration towards the customer

Backward vertical integration towards the supplier

Cheaper supplies gained through bulk-buying

Spreading advertising costs over more units

Borrowing more cheaply as a large firm

Poor communication in a very large organisation

Promoting an existing employee to fill the vacancy

Transferring a worker from another department

Filling a vacancy with someone from the wider labour market

Asking current staff to take on extra duties

Recognition for achievement at work

The level of pay an employee receives

The physical working conditions

The quality of supervision

Autocratic, where the leader decides alone

Laissez-faire, where staff are left to themselves

Democratic, where the leader consults and involves staff

Paternalistic, where the leader decides but explains

A bank loan repaid with interest

Retained profit kept within the business

Share capital from new investors

Trade credit from a supplier

So that it always uses the cheapest source regardless of timing

So that long-term assets are funded by long-term sources and short-term needs by short-term sources

So that it can avoid ever using any external finance

So that it never has to repay any of the money borrowed

Cash flow and profit are always exactly the same figure

A business with positive cash flow must be making a profit

Profit measures the actual movement of money in and out

A business can be profitable yet still run out of cash

Plus 5,000 pounds

Plus 1,000 pounds

Minus 2,000 pounds

Plus 25,000 pounds

Fixed costs divided by the number of units sold

Total revenue minus total fixed costs

Selling price per unit minus variable cost per unit

Variable cost per unit minus the selling price

400 units

2,000 units

500 units

1,000 units

The amount by which actual sales exceed the break-even point

The total fixed costs the business must cover each month

The contribution earned on the very first unit sold

The point at which total revenue equals total variable cost

A favourable variance, because it increases profit

An adverse variance, because it reduces profit

A neutral variance, because costs do not affect profit

A capital variance, because it affects only assets

Revenue minus cost of sales

Revenue minus all expenses and overheads

Net profit minus tax and interest

Cost of sales minus revenue