Unit 17 Starting a Small Business
P4- Explain the financial aspects that will affect the start-up of your business
My business is a dance studio and these are the financial aspects that will affect the start-up of my business are: * Start-up costs * Operating costs * Fixed costs * Variable costs * Revenue * Profit and Loss account * Balance Sheet * Cash flow Forecast
1. Start-up Costs
Start-up costs are the costs incurred before the business starts to operate.
2. Operating Costs

3. Fixed Costs
Fixed costs are the costs that do not vary in relation to the number of items produced. Also known as indirect costs.
4. Variable Costs
Variable costs are the money paid out in direct proportion to the number of items produced and sold. Also known as direct costs.
5. Revenue
Revenue is the total amount of money that are going into the business.
6. Profit and Loss Account
Profit and Loss account shows if the business is successful or not based on if it’s making profit or loss. It shows where the things with the business are going wrong and if the business make loss, and how and what you need to change to help your business.
I need to use profit and loss account for my business because its helping me to deal with the business and to save it if its making loss, as it shows me what I need to change so my business become a successful.
7. Balance Sheet

8. Cash flow Forecast
Cash flow forecasting means budgeting, spending with a limit and estimating what you need to spend and staying below that amount. I need to do it for my business so I don’t spend more than I need to and I can prevent a running out of money and shutting down my business, like prediction of what is likely to happen in the future. I need to do it for my business because it controls my money and the spending as its very important not to go over my