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Study problem · Business

Finance terms in Business without Accounting

Your Business paper uses money words, and you did not take Accounting.

You can follow the finance words in a Business case without studying Accounting. You need five terms and one rule: write what the money did, not only its name.

This page is part of SPM Business. The full list of terms is in the Business glossary.

What do the five money terms mean?

Each term answers a different question about a business.

Term Question it answers Malay
Revenue How much did customers pay for what we sold? hasil, jualan
Cost How much did we spend to make and sell it? kos
Profit What is left after costs? untung
Cash How much money has actually moved in or out? tunai
Capital What money or assets did the owner put in to start? modal

Learn the English and Malay names together, because a question may use either.

How do they work in one small case?

Kedai Roti Mawar sells 400 loaves a month at RM6 each. Ingredients cost RM900. Rent and wages cost RM1 000.

Revenue is 400 × RM6 = RM2 400. Total cost is RM900 + RM1 000 = RM1 900. Profit is RM2 400 − RM1 900 = RM500.

A strong sentence reads: “Kedai Roti Mawar made RM500 profit because its revenue of RM2 400 was higher than its costs of RM1 900.”

Why can profit and cash tell different stories?

Profit counts a sale when it happens. Cash counts money only when it moves.

Suppose a cafe customer takes RM600 of loaves and promises to pay next month. Cash received is RM2 400 − RM600 = RM1 800. Cash paid out is RM1 900. Cash for the month is RM1 800 − RM1 900 = −RM100, even though profit is still RM500.

This is why a case may say a business is profitable but cannot pay its supplier. The word to use is cash flow, and the lesson is on interpreting cash flow forecasts.

Where do students slip?

Three slips cost marks in finance questions.

  • Calling revenue “profit”, so a large sales figure is treated as a large gain.
  • Forgetting that wages and rent are costs, not only ingredients.
  • Writing the number with no meaning, such as “profit is RM500” with no reason.

Fix each by asking, “What did the money do to the business?” and finishing the sentence with that effect.

What can you practise on your own?

Invent a small business and write five lines: its revenue, its costs, its profit, one late payment and the cash that results. Then explain the gap between profit and cash in two sentences.

Use the business case answer planner to structure a written answer, and keep track of slips with the mistake log.

When might one-to-one lessons help?

They help when the terms are known but you freeze in a timed paper, or when English finance vocabulary is the barrier. A teacher can listen to you explain a case aloud and correct the word you keep swapping. See online one-to-one Business tuition.

Common questions

Do I need Accounting to pass SPM Business?

No. The paper asks you to read and use money terms in a case, not to prepare full accounts. You need a small set of terms, such as revenue, cost, profit, cash and capital, and the ability to do simple sums with them.

What is the difference between revenue and profit?

Revenue is the money a business earns from sales. Profit is what remains after costs are taken away. A business can have high revenue and low profit if its costs are also high.

Why can a business have profit but no cash?

Profit counts a sale when it is made, even if the customer has not paid yet. Cash counts only money that has actually moved. Unpaid customers and stock bought in advance can leave a profitable business short of cash.

Should I answer in English or Bahasa Melayu?

Use the language you can explain in most clearly, and learn both names for each term, for example hasil and revenue. Check which language your paper allows on the Lembaga Peperiksaan website.

If a finance question still feels like a foreign language, a one-to-one Business teacher can rebuild each term from your own questions and check that you use it the way the case needs.

  • Online one-to-one lessons for your child with an experienced teacher.
  • Your first class is a one-hour trial, from RM50. The fee is agreed before you book.
  • Happy with the teacher? Continue with lessons of about 1.5 hours. If not, ask for another teacher.