F291 Finance quiz Quiz on finance sector of f291 3.5 / 5 based on 3 ratings ? Business StudiesASOCR Created by: Daisy JudgesCreated on: 26-12-12 21:04 Short term finance is up to 3 years, long term finance is up to 10 years, how long is classed as medium term finance?? 3 to 10 years 1 of 21 What is an overdraft? An arrangement with the bank where a business will be able to withdraw more money from its account than it actually has 2 of 21 What is an disadvantage of an overdraft? High interest rates and difficult to plan ahead 3 of 21 What is an advantage of trade credit? Fast money 4 of 21 In hire purchase, when does the item become your property? In the last payment 5 of 21 What is a big disadvantage of hire purchase? Pay more overtime than you would have upfront 6 of 21 How is leasing different to hire purchase? Items are returned after a stated period of time and it is medium term 7 of 21 How do preference shares differ to ordinary shares? Do not usually allow you to have voting rights but it is paid at a fixed rate 8 of 21 What is an advantage and disadvantage of shares? Advantage: Improve motivation by workforce investing in business. Disadvantage:Complex, time consuming and initially expensive 9 of 21 What is it called when firms raise their cash by selling fixed assets such as machinery or buildings which are no longer in use? Selling Assets 10 of 21 What is a disadvantage of selling assets? Second hand and scrap value is low 11 of 21 What is retained profit? Profits the owners have decided to invest back into the business 12 of 21 What is a disadvantage of retained profit? Leaves the company cash flow poor 13 of 21 How does factoring work? Selling off debts to another company 14 of 21 Will you receive the full amount of debt from factoring? No, just a percentage from the company buying it off you 15 of 21 How is re investing savings different from re investing profit? Not majorly, it is retained profit from previous years or bank savings from stocks and shares 16 of 21 What is a advantage of re investing savings? A reliable method of looking after surplus 17 of 21 What is an advantage of leasing? If equipment breaks the leasing company must repair it at their own expense 18 of 21 What is cash flow? Movement of cash each month in and out of the business 19 of 21 Give a reason for cash flow problems Poor economic conditions 20 of 21 What are two ways in which a business can improve their cash flow? Selling off stock at sale prices and reducing credit periods 21 of 21
Comments
Report