C2 Types of Income Flashcards
What is Income ?
Income is money coming into the Business
What is capital income ?
It is money invested into the business either to set up or to buy equipement
Is capital income Short term or long term finance ?
Long term finance
What is Revenue Income ?
It is money that comes into the business from performing its day - to day operations
What is an example of Revenue Income ?
Selling goods or providing a service
What are some examples of Capital Income ?
Loans
Mortgages
Shares
Owner’s capital
Debentures
What are loans ?
Money lent to the business from a bank or financial instiution
What are mortgages ?
It is a loan for a long period of time for property
Who are shares issued by ?
Shares are issued in companies
What is Owner’s capital ?
Money invested from the owners personal savings
What are Debentures ?
It is a form of loan capital used by large companies. Interest is payable
What are some examples of Revenue income ?
Sales
Rent Received
Comission received
Interest received
Discount received
What are sales ?
Money from the sale of goods or services. Can be cash or credit sales
What does rent received mean ?
If a business that owns property and charges others will receive rent as a source of income
What does comission received mean ?
A business may receive comission on each sale for facilationg and completing a transaction
What does interest received mean ?
Money earned on savings or lending
What does Discount received mean ?
It is a percentage off a sale
Give 2 examples of capital income that a small business is likely to have ?
Loans
shares
Give 2 types of capital income ?
Debentures
Owners capital
Identify 2 types of revenue income for a small business ?
Sales
Interest received
Outline what it is meant by capital income ?
Capital Income is money invested into the business either to set it up or to buy equipement
