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 is the purpose of a salon budget?
Answer: To plan and control income and spending
A budget plans expected income and controls spending to reach financial goals.
A stylist processes a $75 service with a credit card that charges a 3% fee. How much is the processing fee?
Answer: $2.25
3% of $75 is $2.25.
Which metric measures how quickly a salon sells and replaces its retail stock?
Answer: Inventory turnover
Inventory turnover shows how often stock is sold and restocked over a period.
Raising service prices too aggressively without added value most likely risks:
Answer: Losing price-sensitive clients
Sharp price hikes without perceived value can drive away price-sensitive clients.
A key benefit of accepting online booking with deposits is that it:
Answer: Reduces lost revenue from missed appointments
Requiring deposits reduces revenue lost to no-shows and last-minute cancellations.
A salon's fixed costs are $8,000 and variable cost per service is $10, with services priced at $50. What is the break-even number of services?
Answer: 200
The $40 contribution per service divides into $8,000 to give 200 services.
Why is separating business and personal bank accounts important for a salon owner?
Answer: It makes bookkeeping and tax reporting clearer
Separate accounts keep business finances organized and simplify accurate tax reporting.