Revenue; Cost; Fixed cost; Variable cost (17)

Evaluating the business Idea

Revenue - It is the total income earn by the firm by selling their goods and services. It can be calculated as;

Cost

It is the total expenditure incurred by the firm to do their business activities. There are two types of cost;

1. Fixed cost - the cost which does not change with the level of output.
Ex:rent,insurance,salary,advertising

2. Variable cost - the cost which changes with the level of output.
ex:utility bills,wages,raw materials