Ten steps to success on the Unit 2 Finance Exam

Dear Year 11

this is the page that will help you learn all the key terms, equations and the TEN topics that you have studies in this unit.  Feel free to use it wisely.

1. Key Equations that you need to know as your not given them in the online assessment
2. Fixed costs, variable costs and total costs
3. Costs Revenue and how to make and improve profits see BBC video here
4. Business Tools - Calculating the Brake Even Point 
5. Cash flow forecasting
6. Profit and Loss Accounts (AKA Income Statements)
7. Budgeting
8. Sources of Finance available to a business
9. Balance Sheets (AKA Financial Statement)
10. PowerPoint of key topics

and once you have got your head around the main topics why not try the online assessment by clicking  here or use the retired test here and here

I do hope that you use it as it is very much what you do now that's important if you want to do well in this assessment on Thursday 26th November 2020

Good luck and enjoy

Mr T

Preparing for the Finance Exam

Dear Year 12

Here are some more revision resources to support you in getting ready for your online exam on Thursday 

Online Revision Resources for Unit 2 Finance 

Exam Technique Video 1


Ten steps to success in your Online Finance exam on 21st November 2019


Revision Questions and Answers

Topic 5 Budgeting

Dear Year 12

Homework on cash flow forecasting due in today so that I can complete an accurate report on your attitude to learning, independent learning and quality of work.

Todays topic is on budgeting.

Here is todays powerpoint for the lesson

here are the class notes and the first activity for those that like to read up on a topic and test there understanding

And the classroom activity for lesson 2 this afternoon will be on planning a very special event.

I hope that you find it an enjoyable double lesson and a topic that is clearly understiood by the end of the double lesson

Mr T

Week four topic four - the cashflow forecasting tool.

Dear Year 12 Cashflow Champions...

Homework due in - break even point of the fish and chip shop business

Test on learning outcome A - key terms


Introduction on cash flow  - Notetaking


Cashflow activities

• My first social cashflow is here

• My second cashflow

• Revision note to secure a PASS
  
• My third cash flow as an Ebay Designer

• Revision notes to secure a MERIT
  
• My fourth cashflow Pretty Polly

• First Revision activity to secure a Distinction
  
• My final cashflow Bob the Farmer
  

And now for something different...click here


Remember you will be sitting an online test which you need to pass before Christmas

Mr T

Learning Outcome B Planning tools for success

Lesson 4 Topic 3 (B.1) Understand the planning tools businesses use to predict when they will start making a profit

To answer all the 'online assessment' questions on this next topic on the course:

Learners should for a PASS (C):

• Be able to define break-even - the point that a business has made enough money through product sales to cover the costs of making the product (no profit and no loss)

• Be able to interpret (point out or identify) from a break-even chart: the 

• break even point
• profit
• loss
• variable costs
• fixed costs
• total revenue
• total costs
• margin of safety

• Be able to calculate the break-even (formula will be given in the given assessment) using method 1, 2 or both

Method 1 - Contribution Method   For a PASS


Break-even point    =                            total fixed costs
       (output)                    selling price per unit - variable cost per unit


Method 2 - The Break Even Point - (BEP) Graph Method or Seven Steps to Break Even Heaven click here

Learners should for a MERIT (B)

• Be able to analyse and explain the value and importance of break-even analysis to businesses when planning for success 

• Analyse and explain the associated risks to a business of not completing a break-even analysis 

• Present the given information graphically on a break-even chart 

Learners should for a DISTINCTION (A)

• Analyse the effect on the break-even point if sales or (fixed and variable) costs change, and explain the impact of these changes on the business. 

NEXT STEPS in our next lesson - click here

Homework 3 Wk 3

That's all you need to know for topic three now test yourself here

Good luck and enjoy


Mr T

PS if you haven't bought a core textbook the link here might be useful or alternatively you could get a second hand one or dare I say take a trip to use a free one in the library as they are ordering some for in there!

BTEC Business Level 2 - Unit 2 Finance for Business - Lessons 1 & 2

Dear Year 12 BTEC Business L2ers

Business is very abstract and if you don't have a family business and have never had any work experience its sometimes difficult to get your head around stuff.

That said my advice to you is "put yourself in the scenario" try to think about what you would do if you walked into the example and actually had to think like the business owner in the case study you are given.  The sooner you think like the owner the sooner you will start thinking like a business person and it might not come naturally at first but you will start to develop your skills set very quickly and this is a skill set that employers are crying out for.

Anyway, today's lesson covered Learning Aim A - Understanding the costs involved in business and how businesses make a profit.  Although we didn't really get to the importance of profit you do need to know what your costs are before you can start thinking about making a profit and selling anything!

Lesson 1 - Topic A.1 Understand the costs involved in business

After today's lesson you should:

Understand and identify the costs of a business including:

• startup costs - the cost incurred when setting up a business
• operating (running) costs - the costs incurred in the day to day running of a business
• We will start next lesson by testing you on this!

Lesson resources

• Class notes on Costs, revenue, expenditure and profit
• Costs of different types of business
• Total costs worksheet
• Estimating costs homework
• TOTAL COSTS = FIXED COSTS + REVENUE

Lesson 2. we will look at understanding, defining and identifying the difference between fixed cost's and variable costs, direct and indirect costs and total costs.

We will also consider revenue and profit.  The formulae will not be given to you in the exam so you will need to remember these once you have been taught them.

• Revenue = Price per item x No of items sold
• Profit = Total Revenue - Total Costs
• Profit activities worksheet
• Additional profit activities
  

Good luck and enjoy

Mr T

P5 Personal Selling Role Play

Dear Year 12


this is the penultimate assignment for this Unit so well done you.


For this challenge you are demonstrating your skills that you have learnt on this unit.


Selling is an art and your going to be selling a car in the BMW range to two different customer types.


Before you do anything you need to read:

1. PowerPoint of theory notes on Sales and Personal Selling
2. Selling Scenarios that you need to prepare for
3. My personal selling diary
4. Two role plays
5. Unit 5 Sales and Personal Selling Checklist Assistant
6. P5 Selling scenarios mark sheet
7. Mini Warranty as most car dealers make significant sums selling those too

Interim deadline for P5 is Friday 5th April 2019


All Unit course work to date needs to be in by 5th April 2019

P2 Describe the sales skills used by sales staff in three different selling situations.

Dear Year 12 L2

Our second challenge of this unit is P2

Part 2 – Sales Skills and Different Selling Situations (P2)

 

Skill One: Sales preparation skills

Describe a situation where a staff member at the business would need to prepare appearance, subject knowledge and communication skills (think about a situation where a new model of hot tub comes in and sales staff are not familiar with it – what would they need to do in order to be knowledgeable and give accurate information? You also need to talk about appearance and good communication skills)

 

 

Skill Two: Sales Techniques

Describe how a staff member at the business would have to have good cold calling or face to face to communication skills (think about a sales representative giving potential customers a follow up call after meeting them at the weekend. They would try and persuade them that they should come back in and view it again, or perhaps offer them a discount to try and close the deal)

Think about vocal presentation and listening skills as well as being persuasive but not pushy

 

Skill Three: Understanding customers

Describe a situation where staff members would have to understand the needs of their customers (perhaps a disabled customer visits the store or perhaps a family visit the store which would mean there would be children using the hot tub)

1. Powerpoint to support this next challenge here
2. Tick list to help you check your work before you submit it on Friday is here
3. Don't forget you also have your induction pack from last week.
4. Well done Will for asking for the assignment brief, here
5. Unit 1 Part 1 Assignment for those pushing for a Merit or Distinction is hereit is

Challenge issue date: Tuesday 5th March 2019

Hand in date: Friday 8th March 2019

Starting the PENULTIMATE Unit. Unit 5 Sales and personal selling

Dear Year 12L2 Business owners and sales staff of tomorrow


Here is our second to last unit.


As you realised from the lesson selling is a skill and something you can develop and make a living from very easily.


The Kirby Home Cleaning System was the example that we used in class to demonstrate how.


This unit is made up of TWO assignments.




Assignment 1 covers P1-P4 as well as M1 M2 & D1


Part 1 - The Functions of Sales Staff (P1)

 

Explain what business (Hydropool UK) you are going to look at and give an overview of what they sell

Explain that the sales staff has a number of functions which you will describe

• Selling

Explain how the staff are responsible for selling the goods or services

Describe a situation where they make a sale or encourage customers to buy something additional

Is it face to face or over the phone etc.?

• Providing information

Describe how staff in the business might provide information on particular products or services

Give a specific example

• Dealing with routine queries or complaints

Describe a situation where customers might have a question, complaint or query about the product or service

Give a specific example

• Representing the organisation

Describe how the staff members are representatives of the business and it is important for them to be well presented and look professional or sound professional if over the phone

Give a specific situation for your business

The resources for a successful outcome on your first challenge are below

• Sales and personal selling PowerPoint for P1 is here
• Your induction training pack exemplar is here.
• Your P1 tick list / mark sheet is here.
• Unit 5 Assignment part 1 is here 

Challenge set: Tuesday 26th February 2019


Due date: Period 1 Friday 1st March 2019.

P2 Unit 1 Current trends that will impact on my business

Dear Year 12


Here we are at the final furlong


P2 is asking you to explain the CURRENT trends that will impact on any start up business.


M2 is an extension of this and is asking you to compare how TWO of the four trends have impacted on a start up business or how they would impact (positively or negatively on yours)


This here is the template on the school system that will help you create this leaflet


This link here is a few things to consider to ensure you pass P2 first time and M2 first attempt


A few websites to help you source information on social trends is here


Remember your Merit overall for this unit comes from securing M2 which is the additional piece of work that goes into P2. 


To secure M2 you need to choose TWO of the trends in P2 and COMPARE how these have impacted on a start up business.  You could consider the IMPACT on SALES, COSTS, PROFITS or other things like RECRUITMENT 


To make it easier for yourself why not apply this to your own business idea that you discussed in P4
 


Enjoy


Mr T


Deadline for P2  is Friday 1st February 4pm 2019
Deadline for M2 is Tuesday 5th February 4pm 2019

Unit 1 P1 - Considering the External Factors - PESTLE

Dear Year 12


We are now entering the final stage of  the PASS tasks for Unit 1


P1 asks you to consider the local and national factors.  The business environment that a business needs to be able to understand and deal with if it will be successful.

This is your Presentation that will inform your audience about national and local factors in the business environment and how they affect a start up business.  I am not expecting you to present this but is does need to be a powerpoint and the resources below are designed to help and support a successful outcome:

P1 Outline how the business environment can impact on a start up business
Local Factors to consider

Local factors powerpoint - you will probably notice its full of visual examples to support the points you make

Local factors structure guide or blank template


This resource might help in terms of considering the LOCAL FACTORS and location here and here

National Factors to consider

National factors powerpoint

National factors structure guide



This resource might help in considering the NATIONAL FACTORS here

Some more political factors to consider here


Don't stop here - aim for that B grade


For those looking to gain a MERIT on this Unit 1 here is your extension challenge for this piece of work:

M1 Explain how changes in the current business environment are likely to impact on a start up business

Top Tips from the Exam Board

"Learner needs to outline how the business environment can impact on a start-up business"

To do this properly you need to do some research and make sure that you include the references for it.




Where to research and find information:

Sources of information, e.g. broadsheet and local newspapers, professional and trade

journals, websites, business networking organisations

Make sure that the sources you use are reliable and unbiased


This resource here is a summary of what changed in the last budget.  Have a read and identify anything that might impact negatively or be some support when you consider launching your business


IMPORTANT NOTE
Don't forget to include a discussion on the impact of these factors that you identify on your selected group of customers that you intend to target if they are relevant to your business proposition



The deadline for this P1 M1 is Period 1 on Tuesday 22nd January 2019

P5 M4 D2 Looking for investors!

Morning Year 12


Todays challenge is to attract investment for your start up business.


People generally invest in you so make sure you pick an appropriate legal structure and complee your investors report to impress and secure the investment that you need.


Presentations of your suggested ideas fior your individual businesses will be P1 on Monday.


Deadline for P5 is a week today - Friday 11th January 2018 period 1 in my postbox.


HNY


Mr T


Resources to support:

1. Report for Investors Powerpoint
2. Report for Investors Template / Checklist
3. Start Up Costs and Running Costs
4. M4 D2 Resources - Template
5. M4 D2 Resources - Powerpoint

Hat tip to Louis for providing the exemplar here notice how he has put the authentication details into his script!

P4 Unit 1 - My first Business Plan

Morning Year 12 L2

If you have not submitted P3 M3 go and do it period 1 today before you come back P2

https://docs.google.com/document/d/1m1MPjRuZnCo4XXQ582LzfMWcoLwUD4MGCOi4aIK6gPQ/edit?usp=sharing

1. Put yourself in teams of three.

2. Think of nine business start ups.

3. SWOT Analysis or the top three exciting ones to see which one you decide

4. Pick one that you think would be the most successful
5. Now carry out a competitive analysis for one
6. Carry out some secondary research. How big is the market ? Is it in decline or growth? Who appears to be doing well and why?

7. Primary research - Create a ten question survey in first plan the questions then convert them into a google forms

8. Send it to at least 10 people out side school
9. Write up your findings in the form of a business plan see below 

10. Create a presentation to a dragons den audience with the intention of securing investment! How much do you need and how much PROFIT are you happy to give them in return ?

Business plan presentation expectation by next Tuesday 11th December 2018 P1


Working Collaboratively create: 

1. Dragons Den Presentation

P4 Part 2 - Checklist of things to include apart from the Fully competed Business Plan by Tuesday 18th December 2018 3pm in to my post-box!

1. Peter Jones 90 day Business Plan or any other you can find from a bank, Barclays or HSBC or use this one here if its easier? Business Plans - why bovver?
2.  SWOT Analysis 
3. Planning the questionnaire
4. Questionnaire survey - Survey Monkey or Google Forms
5. What the results from the survey tell me
6. Appendix of resources and research
   

Enjoy your start up budget is £10k per business idea as no one will lend you any less!

Mr T

 

 

Turning P3 into M3 for the doube B

Dear Year 12


Tuesday you completed the PASS work
You will also get feedback on your work on P3 by podcast so listen to what WWW & EBI then consider why it led to the grade you got.


Today you NEED to turn it into a MERIT


You have three resources below to help you do it


1. Powerpoint
2. Template




You will also get feedback on your work on P3 by podcast so listen to what WWW & EBI then consider why it led to the grade you got.


You have until the end of Friday to submit the revised submission into Mr T's postbox


Good luck and enjoy


Mr T

The final furlong! Last minute preperations for the Finance exam

Dear all


this PowerPoint here covers the entire Unit 2 content that we have studied the last nine weeks.


After you have done the Formula test for the fourth time today can I suggest that you use it in partnership with a method of testing it.


If each person in the class creates a method for testing each topic that means that you have many tests as well as the PowerPoint to revise.


Other resources can be found on the student shared drive below:
R:\Subjects\Key Stage 4\Business\BTEC L2\Year 11.12 2018-2019\unit 2 finance revision


You need to do more than PASS this exam on Friday during period 1 and I don't see you again after today this week.


Hat tip to Ruben for the Kahoot here on equations.


Exam skills powerpoint here


Topics in Unit 2 are listed here  Why not RAG rate the list and focus on the red stuff!


All best wishes and good luck on Friday.  Your progress on the 4th test today suggests your on the up!


Mr T

Balance Sheets Made Easy

Dear BTEC Business




this page is designed to help you understand a very difficult concept very quickly.


Definition: 
A balance sheet is a valuation of a company at a certain time and place.


It also shows what the company OWES and OWNS at a particular time and place.


It also tells you how the business was financed and should accurately show how the NET ASSETS and the FINANCE BALANCE


So lets start here with this PowerPoint and here and make some notes on this tough topic
Another Example of a balance sheet can be found here




1. Test what you have learnt from the power points above with this balance sheet terminology


2. My first Balance Sheet

A generic balance Sheet that covers all bases see here

3. Key Definitions

4. Key term test here

Revision resources for the whole unit here

Extended reading
What is the difference between an ordinary share and a preference share click here

The YE teams first balance sheet




Super Curricular


A brief history of Accounting


Further reading around the topic here

Learning Aim C - Mastering the P&L accounts aka INCOME STATEMENTS

Dear Year 12


these are the theory resources for todays lesson


Theory notes from todays lesson are here and here




and this is another exam practice opportunity.  Download your copy and complete it with a pen and leave it when completed.


Welcome back


Homework - complete exam questions and revise EXAM EQUATIONS


Mr T

Dear Year 12


This is the first time that you will have seen the exam that your going to get at the end of November.


You only need to get 23/50 to PASS at level 2 but you need to pass it first time or you will have to pay £15 for a RESIT.


You might not know all the questions as we have only covered 7 out of 10 topics.


Anyway good luck and lets see what you know already by clicking here


Mr T


Half term revision resources are here

What does a Profit and Loss Account tell us

Learning Aim C: Understanding how business measures success and identify areas for improvement

1. Start by looking at the slides here and taking some notes
2. Then use this blog page to make more notes and make sure that you have all the key definitions and equations recorded in your notes.  I've underlined them to make it easier to see

Making a profit - Learners should:

• Define Cost of sales = the cost of producing a product
• Define Gross Profit = the money made from selling a product (revenue) after the cost of producing the product (cost of sales) has been deducted
• Calculate Gross Profit - the formula will not be given in the exam
• GROSS Profit = Revenue - Cost of Sales
• Be able to explain the impact of positive and negative gross profit on businesses
• define net profit - the money made from selling a product after all costs (expenditure) have been deducted (formula will not be given in the assessment)
• Calculate Net Profit
• Net Profit = Gross Profit - expenditure 
• Explain the impact of positive and negative net profit on businesses

This video might help so click here

10/10 Key terms test on financial statements - profit and loss accounts

1. Financial statements - a summary of financial records of the business.  These include profit an loss accounts and balance sheets.
2. Profit and loss account - this financial statement summarises if a business made a loss or a profit over the financial period (usually a year) 
3. Sales Revenue - the value of goods sold.  Number of goods sold x selling price
4. Cost of Sales - The cost to the business of the goods sold
5. Gross Profit - the difference between the sales revenue and the cost of the goods sold.  Sales revenue - cost of sales 
6. Gross Profit Margin - the percentage of sales revenue that is gross profit.  The gorss profit % margin = gross profit /  sales revenue x 100
7. Overheads - expenses of the business that are not normally directly part of the production process (e.g. rent and management salaries) 
8. Net Profit - the difference between sales revenue and total costs of the business.  Net profit = gross profit - overheads
9. Net Profit Margin - the percentage of sales revenue that is net profit.  Net profit margin % = (net profit / sales revenue) x 100 
10. Shareholders - the owners of the company who invest in share capital in order to share a proportion of the profit in the form of a dividend.

Exam board expectations
Candidates should be able to identify the various components of a profit and loss account.
Candidates should be able to make judgements of the performance of the business through interpretation of the information contained in simple versions of the profit and loss accounts and the application of gross and net profit margins.
Candidates will be given the relevant formulae for ratios as part of the examination paper


Purpose of financial statements
Profit and loss accounts are just one of the two financial statements that a business uses to show the stakeholders what is happening in the business:

• Managers need to know if a profit is being made
• Shareholders or the owners would not know whether to invest more into the business
• Banks would be uncertain whether to lend more or to demand repayment of earlier loans
• The government would not know how much tax the business should pay
• Workers will be uncertain about jobs and whether the business can afford to pay higher wages

The main financial records that every business needs to calculate include:

1. The number of products sold, the value and what still need to be paid for
2. The goods and services bought
3. Equipment and other assets purchased
4. Wages and other labour costs

The profit and loss account contains five important pieces of information:

• Sales revenue - this increases when the number of units sold or the unit price increases
• Cost of sales - this is the bought in value of the goods plus direct labour costs needed to make the goods
• Gross Profit - this can be increased by increasing sales revenue or by reducing the costs of sales
• Expenses or overheads - these include the fixed costs of the business
• Net Profit - this is a very important profit calculation as it shows how successful the managers were at turning a profit out of the sales once all the costs were deducted from the revenue.

Distinction thinking

In the news Unlike most top football clubs, Arsenal FC is a Public Limited Company.  This means that its accounts are published and anyone can see how well its doing.  Arsenal is owned by Arsenal Holdings plc, with the main shareholder being Danny Fiszman, a Swiss-resident diamond dealer with 24.1%.  The club has two major trading arms football and property and is one of the few Premiership clubs that makes a profit. Posting £36.7m profit in the financial year ending 2008. ( Chelsea lost £76m in the same period and Man U £58m and Liverpool £22m in the same period.  The Profit and Loss account lets all shareholders major and minor and all stakeholders know how well a company is doing. Arsenal revenue was up £23m on the previous period to £223m due to selling more TV and broadcasting rights.  Match day tickets from supporters and season ticket holders was also up £94.6m 


Group activity Punch 'arsenal holdings plc' into a search engine and you will see a list of sites that describe the company, what its worth and how it trades, who its directors are etc. Choose a few sites and see what info they provide and say which you thought was best.  

Still not got it - teach yourself P&L accounts Click on the powepoint here to tell you more. 

The trading account sales revenue ;less the cost of sales (opening stock + purchases - closing stock) this gives the GROSS PROFIT

The profit and loss account gross profit less other expenses such as rent, wages, transport, power, fuel, equipment to give the NET PROFIT

The appropriation account net profit - tax - dividend = retained profit 

Discussion The law requires companies to produce profit and loss accounts to certain standards and at regular intervals.  Why do you think that such accounts have to be made public? Do you think that it is fair that company income should be revealed to everyone in this way?

Web-based activity Look at the other clubs in the football Premiership and find out which are publicly quoted.  Look at the profit and loss accounts for each (go to the 'corporate' or 'investors' part of the website) and decide which is the most profitable.  Make sure that you follow the rules for making comparisons.  If you are not interested in football, you could compare businesses in another sector, fashion for example, or technology.

Typical exam questions on understanding profit & loss accounts

1. What is a public limited company?
2. What is meant by 'sales revenue'?
3. Name three other sources of income, besides sales revenue?
4. Define Gross Profit
5. Name the three parts of the profit and loss account.
6. Explain what happens to retained profit.
7. Outline the unusual items included in the cost of sales.
8. Explain what is meant by 'dividends'
9. Give one major limitation to the usefulness of profit and loss accounts

Worksheets
Calculating total costs click here
Calculating profit click here

Nine mark question
By practicing these nine mark questions you are developing skills and confidence and will access the other 50% of the marks in the Paper 1 & Paper 2 exams