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
What does 'cash flow' refer to in salon financial management?
Answer: The movement of money in and out of the business
Cash flow tracks money coming in and going out over time.
A salon offers a 20% discount on a $50 service during a slow weekday. What is the discounted price?
Answer: $40
20% of $50 is $10, leaving a $40 price.
Which record helps a salon owner prepare an accurate tax return?
Answer: Detailed income and expense records
Accurate income and expense records are essential for filing correct taxes.
Retail products typically carry a higher profit margin than services because:
Answer: There is little added labor cost once stocked
Retail sales add revenue without significant extra labor once the product is on the shelf.
A salon owner sets aside 15% of every service payment for future equipment. This practice is best described as:
Answer: A reserve or savings fund
Setting money aside for planned expenses builds a reserve fund.
If a salon's total monthly revenue is $40,000 and expenses are $34,000, what is the profit margin?
Answer: 15%
$6,000 profit on $40,000 revenue equals a 15% margin.
Cost-plus pricing determines a service price by:
Answer: Adding a set profit margin to the total cost of providing it
Cost-plus pricing adds a desired markup on top of the full cost to deliver the service.