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Essay text:
I.e. Telephone bills.
Variable Costs
Variable are costs that change dependant of the level of output. For example raw materials.
Break Even
The break even point is the point where a businesses outputs will just cover it's cost. Calculating the break even point: fixed costs/(selling price ? variable costs)
Internal Finance
Five sources:
Retained Profit (Putting profit back in)
Fixed Assets (Selling them)
Re-invest savings
External Finance
Short term (less than 1 year):
Overdraft
Personal Savings
Medium-term (1-5 years):
Bank loan
Lease assets instead of buying
Grants
Long-term(>5 years):
Mortgage
Issue more shares
Factors that affect choice:
Amount needed...
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