Sources of Finance

?
  • Created by: K.T.
  • Created on: 15-01-15 12:18
What are some internal sources of finace?
Selling assets, owner funds, profit
1 of 25
What is selling assets
how companies raise money by selling something it owns
2 of 25
Is selling assets a short, medium or long term sollution
Short/medium
3 of 25
What are owner funds?
Money put into the business by the owners (normally when it is first established) and is normally seen by sole traders and partnerships
4 of 25
What are profits?
Moneyleft over after all the costs have been met
5 of 25
Are profits a short, medium or long term solution?
Medium length
6 of 25
What are some external sources of finance?
Loans, overdraft, hire purchase, leasing, government grants, venture capital, selling shares, debentures, factoring
7 of 25
What is a loan?
Money borrowed from the bank or building society which is repayable over a long time
8 of 25
Is a loan a short,medium or long term sollution?
Can be short or long term - interest will be charged
9 of 25
What is an overdraft?
When a business is able to take more money from their bank account than is actually in there
10 of 25
Is an overdraft a short, medium or long term solution?
Short term - interest has to be paid
11 of 25
What is hire purchase?
When a business is able to pay fro an asset over a period of time
12 of 25
Is hire purchasing a short, medium or long term solution?
Medium Solution
13 of 25
What is leasing?
Allowing a business to use equiptment it doesn't own whilst paying an agreed charge
14 of 25
Is leasing a short, medium or long term solution?
Medium
15 of 25
What is a government grant?
financial help give the the business by the government
16 of 25
Is it a short, medium or long term solution?
Long term (depending on how much money is given)
17 of 25
What is venture capital?
Source of finance for businesses that may be considered a risky investment - Investors buy some shares in the business that are receicing the finance
18 of 25
Is a venture capital a short, medium or long term sollution?
Long term
19 of 25
What is selling shares?
When public, or private limited companies raise money buy selling shares in the business. Investors become part owner of the business and will receive deividends
20 of 25
Are selling shares a short, medium or long term loan?
Long term
21 of 25
What are debentures?
Long term
22 of 25
Are debentures a short, medium or long term solution?
Long term
23 of 25
What is factoring?
Allows you to raise finance based on the value of the outstanding invoices
24 of 25
Is factoring a short, medium or long term fix?
Short term
25 of 25

Other cards in this set

Card 2

Front

What is selling assets

Back

how companies raise money by selling something it owns

Card 3

Front

Is selling assets a short, medium or long term sollution

Back

Preview of the front of card 3

Card 4

Front

What are owner funds?

Back

Preview of the front of card 4

Card 5

Front

What are profits?

Back

Preview of the front of card 5
View more cards

Comments

No comments have yet been made

Similar Economics & Business Studies resources:

See all Economics & Business Studies resources »See all Sources of finance resources »