JCE Business Studies key terms

A plan that estimates expected income and sets limits on planned spending over a set period, such as a week or month, so that a person or business can control money use.

The amount of money a person has left after compulsory deductions such as income tax and social insurance contributions, available to spend or save as they choose.

The percentage charged by a lender on money borrowed, or paid by a bank on money saved, usually expressed as an annual rate before or after compounding.

Interest calculated on both the original amount saved or borrowed and on interest already added, so that the balance grows faster than with simple interest over time.

Money set aside rather than spent, often held in a deposit account or savings product, to meet future needs, cover emergencies, or earn interest.

A sum of money borrowed from a bank or other lender that must be repaid, usually with interest, over an agreed period according to set repayment terms.

An asset such as property or equipment that a borrower pledges to a lender, which the lender may take and sell if the loan is not repaid.

A contract in which a person or business pays regular premiums to a company, which then pays out an agreed amount if a specified loss or risk occurs.

The regular payment made by the insured person or business to an insurance company in exchange for cover against a specified risk.

A person who buys or uses goods and services for personal rather than business use, and who therefore has legal protection under consumer law.

The legal protections given to buyers of goods and services, covering matters such as quality, safety, accurate description, and redress when something goes wrong.

A return of money paid by a buyer, usually given when goods are faulty, not as described, or returned within an agreed period under a returns policy.

A seller's or manufacturer's written promise to repair or replace a product if it fails within a stated period, often subject to conditions about normal use.

A business owned and run by one person, who keeps all profits but has unlimited liability for the debts and obligations of the business.

A business owned by two or more people who share capital, profits, and responsibilities under an agreed partnership agreement, usually with unlimited liability unless registered as a limited partnership.

A business registered as a separate legal entity from its owners, whose shareholders' liability for company debts is limited to the amount of capital they invested.

The protection given to owners of a registered company, meaning they can lose only the money they invested and are not personally responsible for company debts.

The position of owners such as sole traders and ordinary partners, who are personally responsible for all business debts and may have to sell personal assets to pay them.

A person or organisation that owns shares in a company, giving them a claim on part of the profits and usually voting rights at general meetings.

A share of a company's profits paid to shareholders, usually as a fixed amount per share, decided by the directors and approved by shareholders.

An arrangement in which a business owner pays a franchisor for the right to use its brand, products, and systems, following set operating rules in return.

The movement of money into and out of a business over a period, showing when cash is received from sales and when it is paid out for costs.

The money a business has available for day-to-day operations, calculated as current assets minus current liabilities, used to pay wages, suppliers, and other short-term costs.

Assets a business expects to convert into cash within one year, such as stock, money owed by customers, and cash held in the bank.

The gradual reduction in the recorded value of a fixed asset over its useful life, reflecting wear, age, or obsolescence, charged as an expense in the accounts.

A financial statement showing what a business owns, what it owes, and the owners' stake at a particular date, based on assets equalling liabilities plus equity.

A financial statement that records a business's revenue, costs, and resulting profit or loss over a period such as a year.

The money left from sales revenue after subtracting the direct cost of the goods sold, before deducting overheads and other operating expenses.

The amount remaining after all expenses, including overheads, interest, and tax, have been deducted from gross profit; the true bottom-line result.

Profit kept in the business rather than paid out to owners or shareholders, used to fund growth, repay debt, or build reserves.

A long-term resource a business owns and uses in its operations, such as buildings, machinery, or vehicles, not intended for resale in the normal course of trade.

Dividing a market into groups of buyers with similar needs or characteristics, such as age, income, or location, so that marketing can be targeted effectively.

The specific group of customers a business aims its products and marketing efforts at, chosen because it can serve them profitably.

The combination of product, price, place, and promotion decisions a business controls to influence demand and reach its chosen target market.

The systematic collection and analysis of information about customers, competitors, and market conditions to support marketing decisions and reduce risk.

The name, design, symbol, or combination of these that identifies a product and distinguishes it from competitors, carrying a reputation in customers' minds.

The level of sales at which total revenue exactly equals total costs, so the business makes neither profit nor loss.

A cost that does not change with the level of output in the short term, such as rent, insurance, or salaries of permanent staff.

A cost that rises or falls directly with the quantity produced or sold, such as raw materials, packaging, and piece-rate labour.

A written document setting out a business idea, its market, operations, finances, and goals, used to guide the owner and attract lenders or investors.

A person who identifies a business opportunity, takes on the financial risk of starting or running a venture, and organises resources to make it succeed.

The process of identifying possible threats to a person or business, assessing how serious they are, and taking steps to avoid, reduce, or insure against them.

A document setting out the duties, responsibilities, reporting lines, and working conditions of a particular post, used in recruitment and performance management.

A profile of the qualifications, skills, experience, and personal qualities a candidate needs to perform a particular job successfully.

The process of attracting and selecting suitable people to fill vacancies, from identifying the need through advertising, shortlisting, and appointment.

The programme of introduction given to a new employee, covering the organisation, its rules, colleagues, and health and safety, to help them settle in.

The reasons and incentives that drive employees to work hard and stay with an employer, influenced by pay, recognition, working conditions, and job design.

A measure of output produced per unit of input such as labour hours, used to judge how efficiently resources are being used.

The cost savings that come from producing on a larger scale, which lower the average cost per unit as fixed costs are spread over more output.

The process of checking products or services against set standards, often at the end of production, to ensure only acceptable output reaches customers.

The management of raw materials, work in progress, and finished goods so that enough is available to meet demand without tying up excessive money in inventory.

The support and treatment a business gives customers before, during, and after a sale, affecting satisfaction, loyalty, and reputation.