2.1.1

Question 1

2 Pros of Sale of Assets

Answer 1

Quick source of finance if buyer found

No control of business given up

Question 2

3 cons of Sale of Assets

Answer 2

Finite amount of assets to sell
May not find a buyer.
Value depreciated over time

Question 3

Define Sale of Assets

Answer 3

Raising cash by selling surplus assets.

Question 4

2 Cons of Owner Capital

Answer 4

Limited amount of finances

Likely to impact entrepreneurs well being

Question 5

1 Pro of Owners Capital.

Answer 5

Quick method of finance

Question 6

Define Owners Capital.

Answer 6

When an entrepreneur uses personal finance to fund the business expenses.

Question 7

3 Cons of Retained Profit.

Answer 7

Unhappy shareholders due to lack of dividends.
Finite amount of cash available.
No additional expertise

Question 8

Define Internal Finance.

Answer 8

Cash coming from within the business.

Question 9

2 Pros of Retained Profit

Answer 9

No loss of ownership.

No additional financial costs ( interest rates )

Question 10

Define Retained Profit.

Answer 10

When a business uses historically generated profit to invest.