Financial Literacy: Entrepreneurship: Revenue, Cost, and Profit
Calculating how businesses earn, spend, and make money
Financial Literacy: Entrepreneurship: Revenue, Cost, and Profit
Calculating how businesses earn, spend, and make money
Financial Literacy - Grade 6-8
- 1
Maya sells handmade bookmarks for $3 each. On Saturday, she sells 18 bookmarks. What is her total revenue?
Revenue is the amount of money earned from sales before subtracting costs.
Maya's total revenue is $54 because $3 x 18 = $54. - 2
A student sells lemonade for $2 per cup. The student sells 45 cups and spends $28 on lemons, sugar, cups, and ice. What is the profit?
The revenue is $90 because $2 x 45 = $90. The profit is $62 because $90 - $28 = $62. - 3
Jordan makes keychains. The materials cost $1.25 per keychain. If Jordan makes 20 keychains, what is the total material cost?
Multiply the cost for one item by the number of items made.
The total material cost is $25 because $1.25 x 20 = $25. - 4
A small business has fixed costs of $40 for a booth rental and variable costs of $2 for each bracelet made. If the business makes 30 bracelets, what is the total cost?
The total cost is $100 because the variable cost is $2 x 30 = $60, and $60 + $40 = $100. - 5
Talia sells candles for $8 each. Her total cost to make and sell 12 candles is $66. What is her profit?
Find revenue first, then subtract total cost.
Talia's revenue is $96 because $8 x 12 = $96. Her profit is $30 because $96 - $66 = $30. - 6
A table shows a snack business: granola bars sold = 50, selling price = $1.50 each, total cost = $42. What are the revenue and profit?
The revenue is $75 because $1.50 x 50 = $75. The profit is $33 because $75 - $42 = $33. - 7
Explain the difference between revenue and profit in your own words.
One amount comes before subtracting costs, and the other comes after subtracting costs.
Revenue is the total money a business earns from selling goods or services. Profit is the money left after the business subtracts its costs from revenue. - 8
A dog-walking business charges $10 per walk. It completes 16 walks in one week. The business pays $12 for flyers and $8 for dog treats. What is the weekly profit?
The revenue is $160 because $10 x 16 = $160. The total cost is $20 because $12 + $8 = $20. The profit is $140 because $160 - $20 = $140. - 9
A business sells phone charms. It earns $120 in revenue and has $95 in total costs. Did the business make a profit or a loss, and how much?
If revenue is greater than cost, the business has a profit.
The business made a profit of $25 because $120 - $95 = $25. - 10
A bake sale earns $72 in revenue. The ingredients and supplies cost $85. Did the bake sale make a profit or a loss, and how much?
The bake sale had a loss of $13 because $72 - $85 = -$13, meaning costs were $13 more than revenue. - 11
A chart shows three products sold at a school fair: stickers, bracelets, and pencils. Stickers earned $36 revenue with $18 cost. Bracelets earned $80 revenue with $50 cost. Pencils earned $25 revenue with $12 cost. Which product had the highest profit?
Subtract each product's cost from its revenue, then compare the profits.
Bracelets had the highest profit. Stickers made $18 profit, bracelets made $30 profit, and pencils made $13 profit. - 12
Sam wants to earn at least $60 profit from selling art prints. Each print sells for $5, and the total cost for supplies and printing is $40. How many prints must Sam sell to reach at least $60 profit?
Sam must sell at least 20 prints. To make $60 profit with $40 in costs, Sam needs $100 in revenue, and $100 divided by $5 per print equals 20 prints. - 13
A student starts a lawn care business. The student charges $25 per lawn and spends $6 on supplies for each lawn. What is the profit per lawn before any other costs?
Profit per item or service can be found by subtracting the cost per item from the selling price.
The profit per lawn is $19 because $25 - $6 = $19. - 14
A school club sells custom water bottles. The club pays a one-time setup fee of $30 and $4 for each bottle. They sell each bottle for $10. If they sell 15 bottles, what are the revenue, total cost, and profit?
Remember to include both the one-time fixed cost and the cost for each bottle.
The revenue is $150 because $10 x 15 = $150. The total cost is $90 because $30 + ($4 x 15) = $90. The profit is $60 because $150 - $90 = $60. - 15
An entrepreneur can choose between two prices for selling notebooks. Option A is to sell 40 notebooks at $3 each. Option B is to sell 25 notebooks at $5 each. If the total cost is $70 for either option, which option gives the higher profit?
Option B gives the higher profit. Option A revenue is $120 and profit is $50. Option B revenue is $125 and profit is $55, so Option B is $5 higher.