Mind Maps have been produced to introduce topics and give students an overview of key topics being studied. This mind map introduces cost, revenue and profit.

Cost, Revenue and Profit - Mind Map

Mind Maps have been produced to introduce topics and give students an overview of key topics being studied. The maps can be viewed as a whole page or, for those who prefer a more linear approach, as a text version.

View larger version of the mind map.

• Revenue
  • TR is the money a business earns from selling goods and services
  • TR = Price x Quantity sold (TR = P x Q)
  • TR can be increased by increasing sales, changing prices or a combination of the two
• Loss
  • A loss occurs when costs are greater than revenue
  • Loss = TC > TR
  • Losses can be expressed as a bracketed term or as a minus number
  • Just because a business makes a loss does not mean it automatically goes 'bust'
• Cost
  • The amount a business spends in producing goods and services and getting them to its customers
  • Fixed costs have to be paid regardless of any output
  • Variable costs vary directly with the amound produced
  • Total costs are the sum of variable and fixed costs
  • TC = FC + VC
• Profit
  • Profit is the difference between total revenue and total costs over a period of time
  • Profit = TR - TC
  • If TR > TC the business makes a profit