Accounting And Finance

Question 1

When setting financial objectives what needs to be considered

Answer 1

The legal status and size of the business
Whether it is a production target or a marketing target
Any budgets set
The state of the economy
The level of competition within the market

Question 2

Setting clear financial objectives allows the businesses or stakeholders to

Answer 2

• have targets to aim for
• assess/monitor the progress of the business in meeting the objectives
• have access to info that sets out the financial situation of the business
• ensure the department understands the constraints
• plan expenditure in a realistic matter
• monitor and access the likely impact of any changes within the economy

Question 3

Define working capital

Answer 3

This is the short term finance which is required for the day to day running of a business

Question 4

What is short term finance

Answer 4

-This is needed for the day to day running of a business and is usually for a period up to 3 years.
-You need to understand the concept of cash flow to understand it.
- there needs to be a sufficient inflow of cash revenue to meet the cash outflows such as wages and bills