Operations 1
CHECKING PRODUCT QUALITY AT THE END OF THE PRODUCTION PROCESS. IF DEFECTED PRODUCTS ARE FOUND, THE ENTIRE BATCH WILL BE THROWN AWAY/REPAIRED
What is Quality Control?
When Total cost = Revenue
What is the break even point?
Money spent on purchasing fixed assets that lasts for over a year, (e.g. office buildings, transport vehicles)
What is Capital Expenditure?
An estimate of future cash inflows & outflows of the business and shows expected balance at the end of each month
What is a cash flow forecast?
CHECKING QUALITY STANDARDS OF A PRODUCT THROUGHOUT THE PRODUCTION PROCESS.
What is Quality Assurance?
A reduction in average cost as a business increases in size
What is economies of scale?
Money spent on day to day expenses (e.g. salaries, maintenance of office building)
What is revenue expenditure?
The amount of capital which is readily available to a business
What is working capital?
CONTINUOUS IMPROVEMENT OF PRODUCTS AND PROCESSES BY FOCUSING ON QUALITY AT EACH STAGE OF PRODUCTION
What is Total Quality Management?
When large firms are able to negotiate cheaper finance deals (e.g. lower bank loans because banks view large businesses as less risky)
What is financial economies of scale?
Short term bank loan to withdraw more money than the businesses actually has. This is later paid back by the business with interest.
What is an overdraft?
Financial statement that records the proftability of a business and all costs incurred to earn that profit over a period of time (for example, one year).
What is an income statement or profit and loss account?
Cost that does not change as the amount of products produced or sold changes.
What is a fixed cost?
When a business becomes too large, it becomes less efficient leading to higher cost of production.
What is diseconomies of scale?
Cash that comes in and out of a business over a period of time
What is cash flow?
The sales revenue – cost of sales/gost of goods sold
What is gross profit?
A cost which changes as the amount of goods produced or sold changes
What is variable cost?
Term for continuous improvement by eliminating waste
What is Kaizen?
The stages between paying out cash for labour, materials, and so on, and receiving cash from the sale of goods.
What is the cash flow cycle?
The actual profit after subtracting the business’ operating expenses such as employee salaries & wages, taxes etc…
What is net profit?