This lesson will be about... Profit and Loss

1. This lesson will be about...Profit and Loss What is profit and loss? What program would we use to create one? Why would we use one?

2. NO IDEA I NEED HELP NEVER HEARD OF IT OK I CAN DO THIS WITH SUPPORT SOME GUIDANCE NEEDED NEARLY AT MY TARGET GOT IT! VERY CONFIDENTWILL HIT MY TARGET GRADE EXCEED TARGET LEARNING OBJECTIVES Investigate PROFIT AND LOSS

3. $262.5 million pq Loss $85 million pq £30 million pa $1.6billion pq Loss £42.6 million pa £35.2million pa

4. Answers (true 2011) • Google – 1.6 billion profit • Arsenal – 35.2million profit • Pets at home £30 million profit • Nike $262.5 million profit • Good year $85 million LOSS • Liverpool £42.6 million LOSS

5. questions…. • What is profit? Sales Revenue – Costs/ expenses • How is profit used? Expansion, investment… • Why is profit important? A main FINANCIAL objective, it measures success,difference between success and failure

6. The Profit and loss account(is this on your financial key terms?) • A record of past costs and revenues (often for 1 year) • How can looking at past performance help a business plan for the future? • Who will be interested in a companies profit and loss account? Managers- planning purposes, Owners, Potential investors

7. profit…. Sales Revenue – Total Costs • Costs are costs that go into actually making the products • i.e. Nike’s costs of sales = premises, workers, raw materials (rubber, leather)

8. 25 – 30 minutes TASK • Looking at the task sheet input the figures in the correct place on the profit and loss template. • Template (on excel) can be found on S:\Hunter, mrs\Year 10 GCSE\1.3 • (hair by hunter .xls)

10. Weekly Profit and Loss (Hair by Hunter) • Washing clothes cost £10 per day and Hair by Hunter is open 6 days a week! That’s a lot of towels that need washing and drying. • This week a rep has been by and the owner has decided to buy £150 worth to sell for a large profit. However, when she added this up she only made £25 on all of these. Shampoo costs range, but usually she is looking at £70 per week, but this is all depending on clients hair. This week she has spent half of what she usually does on Shampoo. Hair colours are popular and £100 has been spent on colorants this week. • In terms on bills the hairdressers pay per litre of water (25p) and this week Hair by Hunter have used 800 litres of water. In addition to this there is heating and lighting which is £180 this week. • In terms of sales OAP’s they are charged £12, Ladies spend £50 and gents are £4 per cut. • OAP’s seen this week 22 • Ladies seen this week 50 • Gentlemen seen this week 20 • How much profit (or Loss) does Hair by Hunter make? (or loose)

12. TASK questions • What problems can you see in your finished profit and loss statement? • How could you improve the businesses financial position next year?

13. Extension ACTIVITY • Using this template can you input your figures that you gathered last week. • Decide upon a selling price and calculate a profit and loss statement for the bank. • Could you business actually work?

14. Summary activity • Log off and can you describe.... • What is a profit and loss account? • Who wants to see such a statement? • No cheating!