Page 6 - INSIDE ACCESS JUNE 21 3RD EDITION

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ESSENTIAL WORDS FOR SMALL BUSINESS
GROSS INCOME
Your income BEFORE taxes and expenses
COSTS OF GOODS (COG)
This refers to the total cost of labour and materials required to provide products or services
NET INCOME
What your business earned AFTER your taxes and expenses
MARK UP
How much you add to the COG of your product or service to make a profit
EXPENSES
Anything you pay for that is necessary for your business
GROSS MARGIN
How much you add to the COG of your product or service to cover additional
expenses and make profit
LIABILITY
Debt that you owe. Can be short term or long term
PROFIT MARGIN
The percentage of your total revenue that you keep as profit
RECEIVABLE
Anything that is owed to you
OWNERS’ DRAW
What you take out of your business for personal use (used for sole proprietors)
ASSETS
Everything of value that your business owns and uses to operate
PAGE 6 INSIDE ACCESS | JUNE 2021 3RD EDITION