Bussiness lecture 6: Finances
All about the control of money, and flows of money
History...
People made things, and traded them with each other
to get other things they wanted..
Commonly referred to as Barter, this trade often related to food
After a while, this “trade” used standard values and common values –
such as gold and sliver or set weights.
Shortly after this – and because of growing economies, and complexity of
economies – minted coins began to become common, the start of money
as we know it today.
“Money” has several different definitions.
1.The cash you have [endif]
2.The cash you have + the cash you can get (eg, from savings) [endif]
3.The cash you have + the cash you can get + loan credit. [endif]
4.Loan credit - short term or long term
COST
PRICE
PROFIT
LOSS
INCOME
EXPENDITURE
DEBT
CREDIT
Business terms
Direct costs - Costs that are directly attributable to the overall cost of the item.
Indirect costs - Costs that are not directly attributable to the overall cost of the item.
Variable Costs – a cost that varies with output
Fixed Costs – a cost that does not vary with output
Costs of Running the Business
General costs that can not be DIRECTLY apportioned to
a client.
eg: heating, lighting, building repairs, management costs etc
Costs of undertaking particular Projects
Specific costs that can be allocated directly to a client
eg, product costs, design costs, etc.
Taxation Issues
Income Tax Bands:
£10,600 - £31,785 20%
£31,786 - £150,000 40%
£150,000 + 45%
National Insurance:
Employee earning over £155pw 12%
Self employed with profit over £5965 pa. 2%
