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1. Profits kept back in the company for reinvestment is called _____________ profit. (1 word)

Retained profit refers to the portion of a company's profit that is not distributed to shareholders as dividends, but instead is kept within the company for reinvestment purposes. It is a form of internal financing that allows the company to fund its growth and expansion initiatives, such as acquiring new assets, developing new products, or expanding into new markets. By retaining the profit, the company can strengthen its financial position and increase its future earning potential.

Explanation

Retained profit refers to the portion of a company's profit that is not distributed to shareholders as dividends, but instead is kept within the company for reinvestment purposes. It is a form of internal financing that allows the company to fund its growth and expansion initiatives, such as acquiring new assets, developing new products, or expanding into new markets. By retaining the profit, the company can strengthen its financial position and increase its future earning potential.

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2. The suppliers of goods to a retail store may offer the retailer goods on credit with an arrangement for payment at a later date. This method of financing is called:

Trade credit is a method of financing where suppliers offer goods to a retailer on credit, allowing the retailer to make payment at a later date. This arrangement allows the retailer to acquire inventory without immediate cash payment, providing them with flexibility and liquidity. Trade credit is a common practice in the retail industry, as it helps businesses manage their cash flow and maintain relationships with suppliers.

Explanation

Trade credit is a method of financing where suppliers offer goods to a retailer on credit, allowing the retailer to make payment at a later date. This arrangement allows the retailer to acquire inventory without immediate cash payment, providing them with flexibility and liquidity. Trade credit is a common practice in the retail industry, as it helps businesses manage their cash flow and maintain relationships with suppliers.

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3. A store sells a box of candy for $18 after buying it for $14.50.
If fixed costs per month is $4,560.50, At least how many boxes must be sold for the store to say it is profitable?

To determine the minimum number of boxes that must be sold for the store to be profitable, we need to consider the profit made on each box. The profit per box is calculated by subtracting the cost price from the selling price. In this case, the profit per box is $18 - $14.50 = $3.50.

To cover the fixed costs per month of $4,560.50, the store needs to generate enough profit to cover this amount. Dividing the fixed costs by the profit per box gives us $4,560.50 / $3.50 = 1304.14285714. Since we cannot sell a fraction of a box, the store needs to sell at least 1305 boxes to be profitable.

Explanation

To determine the minimum number of boxes that must be sold for the store to be profitable, we need to consider the profit made on each box. The profit per box is calculated by subtracting the cost price from the selling price. In this case, the profit per box is $18 - $14.50 = $3.50.

To cover the fixed costs per month of $4,560.50, the store needs to generate enough profit to cover this amount. Dividing the fixed costs by the profit per box gives us $4,560.50 / $3.50 = 1304.14285714. Since we cannot sell a fraction of a box, the store needs to sell at least 1305 boxes to be profitable.

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4. The opposite of a cash surplus is a cash _ _ _ _ _ _ _ .

Loss

Deficit

Excess

Bankruptcy

A cash surplus refers to having more cash inflows than outflows, resulting in a positive balance. Therefore, the opposite of a cash surplus would be a cash deficit, which indicates that there are more cash outflows than inflows, resulting in a negative balance.

Explanation

A cash surplus refers to having more cash inflows than outflows, resulting in a positive balance. Therefore, the opposite of a cash surplus would be a cash deficit, which indicates that there are more cash outflows than inflows, resulting in a negative balance.

5. Building blocks in the construction industry is an example of which type of cost?

Variable

Fixed

Sunk

Building blocks in the construction industry can be considered as a variable cost because the quantity of building blocks required can vary depending on the size and complexity of the construction project. As the project size increases, the cost of building blocks will also increase proportionally. Conversely, if the project size decreases, the cost of building blocks will decrease as well. Therefore, the cost of building blocks is directly related to the level of activity or output in the construction industry, making it a variable cost.

Explanation

Building blocks in the construction industry can be considered as a variable cost because the quantity of building blocks required can vary depending on the size and complexity of the construction project. As the project size increases, the cost of building blocks will also increase proportionally. Conversely, if the project size decreases, the cost of building blocks will decrease as well. Therefore, the cost of building blocks is directly related to the level of activity or output in the construction industry, making it a variable cost.

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