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Topics Covered

Topics Covered. Business Costs Revenue Profit Expenditure Break Even Analysis Budgeting Cash Flow Forecast Profit & Loss Balance Sheet Maximising Profits. UNIT TITLE: Unit 2:Finance for Business LESSON TITLE: Balance Sheet LEARNING AIM: C. COMPETENCY FOCUS:

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Topics Covered

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  1. Topics Covered • Business Costs • Revenue • Profit • Expenditure • Break Even Analysis • Budgeting • Cash Flow Forecast • Profit & Loss • Balance Sheet • Maximising Profits

  2. UNIT TITLE:Unit 2:Finance for Business LESSON TITLE: Balance Sheet LEARNING AIM: C COMPETENCY FOCUS: Key Skills (L5): you will be able to develop your numeracy skills to calculate financial transactions of a business and to interpret financial data. Learning Objectives By the end of the lesson, you should be able to… LO1) To describe the purpose of a balance sheet LO2) To complete a balance sheet from information provided LO3) To analyse financial statements for a small business and suggest appropriate actions that the business can take to succeed.

  3. I can recognise the layout of the Balance Sheet, input data correctly and explain what the figures show:

  4. What is a Balance Sheet? • A balance sheet records where the business got its money from and what it has done with it. The two balance out exactly! • It shows the value of all assets and capital on a particular date (last day of financial year – 31st March)

  5. Assets: All of the premises, machinery, equipment, stocks and cash owned by the business at a given time. Liabilities: The debts of the business Equity: The amount invested in the business.

  6. Fixed Assets Vs Current Assets Fixed Assets: Assets that are owned and are expected to be kept for more than 1 year or many years. Current Assets: Assets that can be converted in to cash more easily and are only retained for less than 1 year. These are listed in order of liquidity (easiest to convert in to cash)

  7. Current Liabilities Current liabilities are bills the firm has to pay soon (within 1 year) Included in current liabilities are: -creditors (money owed to suppliers for stock) - Corporation tax (to Government) - Unpaid dividends to shareholders

  8. Current Assets Net Current Assets(working capital) = Current Assets – Current Liabilities Net assets (what the company is worth) = Net current assets + fixed assets

  9. TASK 1 Complete ‘Big Tasty Burger’ Case Study [40mins]

  10. TASK 2 Complete ‘The Biscuit Factory’ Case Study [40mins]

  11. TASK 3 Use the revision guidance notes to produce your own revision notes ready for the exam! [40mins]

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