1. What do you think turnover means?
Starter
This graph shows the turnover for Asda over the last 10 years.
Think pair share:
What do you think turnover means?
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2. Estimating Revenues, Costs and Profits
GCSE Business Studies
Estimating Revenues, Costs and Profits
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3. Learning Objectives by the end of this lesson students….
Will be able to evaluate methods for improving profit
Evaluation ~ GCSE Grade A*
Will be able to propose fixed and variable costs
Synthesis~ GCSE Grade A
Will be able to analyse the impact of profit and loss
Analysis ~ GCSE Grade B
Will be able to demonstrate understanding by using examples/cases
Application ~ GCSE Grade C
Will be able to explain the different types of costs
Comprehension ~ GCSE Grade D
Will be able to recall key terms revenues, fixed costs, variable costs
Knowledge ~ GCSE Grade E
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4. Revenues (sales revenue or turnover or sales turnover)
Theory
Notes
Revenues (sales revenue or turnover or sales turnover)
The amount of income received from selling goods or services over a period of time
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5. Total Revenue= Price x Quantity
Theory
Notes
Total Revenue
Total Revenue= Price x Quantity
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6. Task Yeovil Town FC sells 7,000 tickets at £20 each
Work out the total revenue
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7. Task Total Revenue= Price x Quantity Price = £20 Quantity 7,000
TR = 20 x 7,000
Total Revenue = £140,000
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8. Theory
Notes
Estimating Price
Some businesses cannot estimate price with full confidence
For example: BP expected petrol prices would average £1.00 per litre when it was £1.15
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9. Estimating Price Prices cannot be estimated with confidence when:
Theory
Notes
Estimating Price
Prices cannot be estimated with confidence when:
Business operates in a market where prices change due to supply and demand
Competition is direct and fierce
Launching a new product
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10. Estimating Quantity The demand for a product or service
Theory
Notes
Estimating Quantity
The demand for a product or service
Some products can be predicable
Some have seasonal peaks and troughs
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11. Costs – fixed or variable
Salaries
Rent
Wages
Stock
Raw materials
Council tax
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12. Theory
Notes
Fixed Costs
Costs which do not vary with output produced. E.g. rent, advertising costs, business rates
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13. Fixed Costs Salaries Rent and council tax Machinery and equipment
Theory
Notes
Fixed Costs
Salaries
Rent and council tax
Machinery and equipment
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14. Theory
Notes
Variable Costs
Costs which change directly with the number of products made by a business e.g raw materials
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15. Variable Costs Raw Materials Energy Piece-rate labour Theory Notes
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16. All costs of a business TC = FC + VC
Theory
Notes
Total Costs
All costs of a business TC = FC + VC
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17. Watch this video Progress Arrow
gprinciplesvid.shtml
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18. Against the Clock
You have 5 minutes in groups (before the sand runs out!) to write on your whiteboards:
Examples of Fixed and Variable costs
Now Feedback to class

19. Profit or Loss
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20. Theory
Notes
Profit
Occurs when the revenues of a business are greater than its costs over a period of time
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21. Theory
Notes
Loss
Occurs when the revenues of a business are less than its costs over a period of time
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22. Calculating Profit or Loss
Theory
Notes
Calculating Profit or Loss
Profit/Loss =
Total Revenue – Total costs
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23. Impact of profits and losses
Theory
Notes
Impact of profits and losses
Businesses can estimate profits
However these could be too optimistic
What if the price of petrol, electricity went up?
What if competition is so fierce lower prices have to be offered?
Losses are a sign that the business needs to make change or close.
Profits would enable a company to invest more or expand
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24. Learning Objectives by the end of this lesson students….
Will be able to evaluate methods for improving profit
Evaluation ~ GCSE Grade A*
Will be able to propose fixed and variable costs
Synthesis~ GCSE Grade A
Will be able to analyse the impact of profit and loss
Analysis ~ GCSE Grade B
Will be able to demonstrate understanding by using examples/cases
Application ~ GCSE Grade C
Will be able to explain the different types of costs
Comprehension ~ GCSE Grade D
Will be able to recall key terms revenues, fixed costs, variable costs
Knowledge ~ GCSE Grade E
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