sources of finance for large businesses 3.0 / 5 based on 2 ratings ? Business StudiesFinanceGCSEAll boards Created by: LeahCreated on: 07-02-13 17:24 what are the sources of finance for a large business? (4 details) retained profits, fixed assets, shares, bank loan 1 of 15 how can retained profit be used as a source of finance? profit that the owners have decided to put back into the business after theyve paid themselves a dividend. 2 of 15 how can fixed assets be used as a source of finance? firms can raise cash by selling fixed assets that are no longer in use. 3 of 15 how can shares be used as a source of finance? A limited company can issue more shares. 4 of 15 what are four factors that affect the choice of finance? size and type of company, amount of money needed, length of time the finance is needed for, cost of finance 5 of 15 why is size and type of company an issue when considering the source of finance to use? not all companies have access to all types of finance, some types of business may not have fixed assets available to sell. 6 of 15 why is the amount of money needed a thought to consider when needing a source of finance? a company wouldnt issue more shares to buy something small. 7 of 15 why is the length of time an issue when deciding what source of finance to use? do not take to take out a mortgage over a short period of time. should used retained profit or overdraft for a short term lack of finance. 8 of 15 what are internal and external sources of finance? internal comes from inside the business and external sources are from outside of the business 9 of 15 give 3 internal sources of finance business savings, retained profits, selling fixed assets 10 of 15 give 3 external sources of finance bank loans and overdrafts, venture capital, grants 11 of 15 why does the cost of finance need to be considered when thinking about sources of finance? some sources are more expensive such as a bank loan because money has to be paid back with interest. 12 of 15 what are the advantages of internal sources?(2 details) quick and easy way to get money, saves borrowing and having to pay back interest. 13 of 15 what is the problem with selling fixed assets? there is a limit to how many you can sell, too many and you cant go on trading 14 of 15 what is the problem with selling shares? less control of the business for existing owners. 15 of 15
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