Revenue, costs, profit and loss: the calculation of revenue, fixed, variable and total costs, profit and loss, the importance of profit, and the difference between gross and net profit.

A 3-mark AO2 calculation. Revenue is selling price times quantity, so $15 \times 4{,}000 = 60{,}000$. Profit is revenue minus total cost, so $60{,}000 - 48{,}000 = 12{,}000$. One mark for the correct revenue, one for the correct method (revenue minus total cost), and one for the correct profit of 12,000. A common error is to confuse revenue with profit, or to subtract the units rather than the costs; revenue is the top line, profit is what is left after all costs.

A 6-mark question pairing AO2 calculation with AO3 analysis. Total variable cost is $6 \times 20{,}000 = 120{,}000$; total cost is fixed plus variable, $80{,}000 + 120{,}000 = 200{,}000$. Revenue is $14 \times 20{,}000 = 280{,}000$, so profit is $280{,}000 - 200{,}000 = 80{,}000$. Analysis (chained and applied): one way to raise profit is to increase the selling price, which raises revenue on each unit, but this risks losing price-sensitive customers, so the gain depends on demand; alternatively, cutting the variable cost per unit (cheaper materials or better efficiency) widens the margin on every unit sold without raising the price, though it must not harm quality. The chain to credit links the chosen method to its effect on profit and its risk. Markers reward the correct figures plus a developed explanation of one profit-raising method and its trade-off for the manufacturer.