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Financial Management and Pricing Flashcards

7 cards from real Beauty Business practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.

Read the first 7 Financial Management and Pricing flashcards as text

  1. A stylist earns 45% commission on a $60 color service. How much does she earn from that service?

    Answer: $27

    45% of $60 is $27.

  2. What financial statement shows a salon's revenues and expenses over a period of time?

    Answer: Income statement

    The income statement (profit and loss) reports revenue and expenses over a period.

  3. A salon buys shampoo at $8 wholesale and sells it at $16 retail. What is the markup?

    Answer: 100%

    An $8 increase on an $8 cost is a 100% markup.

  4. Which of the following is a variable cost for a salon?

    Answer: Color and developer used per client

    Product used per service rises and falls with client volume, making it variable.

  5. What is the main benefit of offering prepaid service packages to clients?

    Answer: It improves cash flow and client retention

    Prepaid packages bring cash in early and encourage repeat visits.

  6. A salon's overhead is $12,000 per month and its average service profit is $30. How many services must it perform monthly to cover overhead?

    Answer: 400

    $12,000 divided by $30 equals 400 services.

  7. Value-based pricing sets a service price primarily according to:

    Answer: The perceived value and results to the client

    Value-based pricing reflects the worth and outcome clients place on the service.