domain 4 test review

Jack owns a garden supply store. His revenue at the end of last month was $12,200. What is Jack's run rate?

$146,400

One should separate ________ costs from one-time costs when starting a new business.

monthly

You operate a small insurance office with a partner. which expense is a fixed cost?

property lease for the office

Dave is opening a pizzeria. Match the cost to its type.

rent = fixed insurance= fixed property tax = fixed dough = variable costs credit card fees = variable costs employee wages = variable costs pizza boxes= variable costs

An operating budget is a projection of ________ and expenses for a specified period such as a quarter of a year?

revenues

Tina owns a car dealership. She just received a shipment of luxury sports cars. She paid $50,000 for each vehicle and wants to make 25% on each car sale. What is Tina's selling price?

$62,500

James owns a sporting goods store. He just manufactured his own bicycle brand and needs to figure out what the selling price should be. The manufacturing cost per bike is $65, and his desired profit margin is 15%. What is James's selling price?

$74.75

You have a handyman services business. You have the following financial information for the month. • initial cash balance: $1,500 • projected revenue based on existing clients: $2,500 • gas: $100 • equipment maintenance fees: $300 • truck payment: $400 • payroll: $3,000 • insurance: $120 What is your projected ending cash balance for the month?

$80

Terri owns a computer repair shop. Her revenue at the end of last month was $7,450. What is Terri's run rate?

$89,400

Hailey owns a bike shop. She is preparing the cash flow statement for her first year of operation. She had a beginning cash balance of $4,700, $101,000 in total cash sales, $3,300 for utilities, $2,500 in loan payments, and $5,600 for marketing costs. What is Hailey's ending cash balance?

$94,300

Jerry owns an ice cream parlor. His starting balance last month was $1,900. His ending balance was $2,200. What is Jerry's burn rate?

-$300

Which two are benefits of using Angel investors to help start a business?

-Angels often accept a lower return on investment compared to other sources of equity capital -Angel investors typically do not expect to be paid until the business begins making money

Which are eligibility requirements for a Small Business Administration (SBA) grant?

-The business must operate for profit -The company must do business within the United States or its territories -The owners must have responsible owner equity to investment

Select two statements about requirements to obtain funding

-the process..... -equity financing.....

1. The amount of gross sales from goods and services. 2. The costs a business has to maintain operations and sell goods and services. 3. The amount of money a business owes to vendors. 4. The amount of money customers owe to a business for goods and services sold.

1. Revenue 2. Expenses 3. Accounts payable 4. Accounts receivable

When must real estate loans through the Small Business Administration (SBA) be paid back?

25 years

Holden owns a restaurant. His assets include $6,500 in cash, $2,400 in inventory, $8,000 in equipment, and $15,000 for a delivery vehicle. His liabilities include a $3,500 credit card balance, $2,200 in bank loans, and $12,500 in mortgage payments for the restaurant. What is Holden's equity?

$13,700

Lauren owns a restaurant. She had a beginning cash balance of $2,500, $57,250 in total cash sales, $5,300 for utilities, $7,500 in loan payments, and $3,200 for marketing costs. What is Hailey's ending cash balance for the year?

$43,750

Larry owns a shoe store. His starting balance last month was $17,300. His ending balance was $14,700. What is Larry's burn rate?

$2,600

Amanda is the owner of a flooring company. Her assets include $15,000 in cash, $10,000 in inventory, & $5,000 in equipment. Her liabilities include a $6,000 credit card balance and $800 in long-term debt. What is Amanda's equity?

$23,200

A barber charges $20.00 per haircut. The total cost for running his home-based business is $4,000.00 per month, which includes his salary of $3,000 per month. The minimum number of haircuts he must do to cover all of these expenses and his salary is 200 per month. The barber wants to increase his salary to $4,000 per month, making his total monthly expenses $5,000. What is the minimum price he must charge for each of the 200 haircuts so he can cover this increased salary?

$25

Devin owns a clothing store. He recently purchased jeans to sell in his store. He paid $23 for each pair of jeans, and his desired profit margin is 18%. What is Devin's selling price?

$27.14

When must equipment and inventory loans through the Small Business Administration (SBA) be paid back>

10 years

a nail salon pays $2500 in rent per month and each nail technician gets paid $20 per client visit. Supplies cost $500 per month. At 150 client visits per month, how much does the salon have to mark up each visit, percentage wise, for to break even at the end of the month.

100%

Melody owns a dog grooming business. Her total monthly cost is $2,750. She charges $25 per grooming service. How many dogs must Melody groom to break even each month?

110

balance sheet for year ending dec 31

11k

You recently started a small affiliate marketing service. Last month you spent $1,000 on a pay-per-click online advertising campaign that resulted in $1,200 sales. What was last months return on investment (ROI) for your affiliate marketing service.

20%

Tom owns a hat shop. His total monthly cost is $1,850. Each hat costs $50. How many hats must Tom sell to break even each month?

37

Clare sells gourmet boxes of chocolates. One box of chocolates costs Nancy $6.75 to produce. She sells her boxes of chocolate for $10.00. What is Clare's return on investment (ROI)?

48%

Danny sells skateboards. One skateboard sells for $55, and the cost to produce a skateboard is $35. What is Danny's return on investment (RO)?

57%

1 2 3 4 5

Bootstrapping Small business administration (SBA) loans Small business administration (SBA) grants investor crowdfunding

What is the formula for determining a break-even point?

Break-even point = Total cost / Product or service sales price

What is the formula for determining burn rate?

Burn rate = Month starting balance - Month ending balance

What is the formula for determining run rate?

Current revenue for one month x 12

What is the formula for determining ending cash balance?

Ending cash balance = Total cash - Total costs

What is the formula for determining equity?

Equity = Assets - Liabilities

What is the formula for determining gross profit?

Gross profit = Income - Cost of goods

Which expense is a variable cost?

Hourly wages for an office employee

What is the formula for determining income tax expense?

Income tax expense = Gross profit x Tax rate

A startup business is looking for ways to get funded. Which type of funding funds a business through private investments during a set period of time?

Incubator

Deidre owns a pet store. Last month, her income was $5,500, her cost of goods was $800, and her total expenses were $2,600. What are Deidre's net income and gross income for last month?

Net income = $2,100 and Gross income = $4,700

Ben owns a print shop. Last quarter's income was $8,000, his cost of goods was $650, and his total expenses were $4,300. What are Ben's net income and gross income for the last quarter?

Net income = $3,050 and Gross income = $7,350

What is the formula for determining net profit?

Net profit = Value of investment - Cost of investment

Which statements are true about start up costs and operating costs

Operating costs include payrolls logo and website design are examples of start up costs

What is the formula for determining return on investment (ROI)?

ROI = (Net profit / Cost of investment) x 100

What is the formula for determining selling prices?

Selling price = (Cost x Desired profit margin) + Cost

true about equity v debt financing

all except the one starting with equity

Which two costs should be included when calculating start-up costs for a business.

business cards permits, licenses, incorporation fees

Which three types of information can be found on a balance sheet?

equity liabilities assets

Which two types of information can be found on a profit and loss statement?

expenses revenues

Fixed costs change depending on the volume of the product?

false

Variable costs _______ depending on production.

fluctuate