Domian 4 ESB

Fixed Cost examples are?

Rent, Property Tax, Insurance

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

$62,500 Explain: 50,000*0.25 = 12,500 50,000 + 12,500 = $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 Explain: 65*0.15 = 9.75 65 + 9.75 = $74.75

Teri owns a computer repair shop. Her revenue at the end of last month was $7450. What is Terri's run rate?

$89,400 Explain: 7,450 * 12 = $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 Explain: 4,700 + 101,000 = 105,700 (total cash) 3,300 + 2,500 + 5,600 = 11,400 (total costs) 105,700 - 11,400 = $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 Explain: 1,900 - 2,200 = -$300 (burn rate)

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 Explain: 2,500 + 57,250 = 59,750 (total cash) 5,300 + 7,500 +3,200 = 16,000 (total costs) 59,750 - 16,000 = $43,750

Variable costs ________ depending on production.

Fluctuate

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 Explain: 6, 500 + 2,400 + 8,000 + 15,000 = 31,900 (total assets) 3,500 + 2,200 + 12,500 = 18,200 (total liabilities) 31,900 - 18,200 = $13,700

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

$146,400 Explain: 12,200 * 12 = $146,400 (run rate)

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 Explain: 17,300 - 14,700 = $2,600 (burn rate)

Amanda is the owner of a flooring company. Her assets include $15,000 in cash, $10,000 in inventory, and $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 Explain: 15,000 + 10,000 + 5,000 = 30,000 (total assets) 6,000 + 800 = 6,800 (total liabilities) 30,000 - 6,800 = $23,200

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 Explain: 23*0.18 = 4.14 23 + 4.14 = $27.14

Which are eligibility requirements for a Small Business Administration (SBA) grant? Choose three answers.

1. The company must do business within the United States or its territories 2. The business must operate for profit 3. The owners must have responsible owner equity to investment

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

10 years

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 Explain: 2,750/25 = 110

Tom owns a hat shop. His total monthly cost is $1850. Each hat cost $50. How many hats must Tom sell to break even each month?

37 Explain: 1,850/50 = 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% Explain: 10.00 - 6.75 = 3.25 3.25/6.75 = 0.48 0.48 * 100 = 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% Explain: 55 - 35 = 20 20/35 = 0.57 0.57 * 100 = 57%

Bootstrapping

An owner uses their own savings to fund the business

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

Expenses; Revenues

Small Business Administration (SBA) Grants

Free money given to small business owners to help with the launching and development of their business. They do not have to be paid back

Investor

Helps fund a business or a specific project, usually for some kind of stake in the company

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

Liabilities; Assets; Equity

Small Business Administration (SBA) Loans

Loans must be paid back with interest. The maturity terms differ depending on the type of loan

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

Monthly

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 the last month

Net income= $2,100 and Gross income = $4,700 Explain: 5,500 - 800 - 2,600 = $2,100 (Net income) 5,500 - 800 = $4,700 (Gross income)

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 Explain: 8,000 - 650 - 4,300 = $3,050 (Net income) 8,000 - 650 = $7,350 (Gross income)

Variable Costs examples are?

Pizza Boxes, Employee wages, credit card fees, dough

Crowdfunding

Sharing a startup business on an online platform where one can pre-sell products. The money from the pre-sale orders can be used as capital to build the products