Finance

Question 1

What sources of finance would a sole trader use

Answer 1

-savings.
-bank loans.
-family and friends loans

Question 2

What finance would a partnership use

Answer 2

-savings
-loan banks
-overdraft

Question 3

What finance would a enterprise use

Answer 3

Government grants.
Savings.
Sales

Question 4

What is a cash budget

Answer 4

An estimate of a company’s cash coming in and out of the business

Question 5

What is surplus

Answer 5

The amount of money left over once bills are paid

Question 6

What’s a deficit

Answer 6

When there isn’t enough money

Question 7

What’s the receipts in?

Answer 7

Grant
Sales
Total receipts

Question 8

Receipts out?

Answer 8

Rent
Telephone
Advertisement
Electricity etc.

Question 9

Cash budget sum

Answer 9

Opening balance + receipts in - receipts out = closing balance

Question 10

Benefits of using a cash budget

Answer 10

-helps predict high or low periods.

Question 11

Reasons for poor cash flow.

Answer 11

-spending too much money on stock that has not sold.
-giving customers too long to pay debts.
-not enough time to pay bills.

Question 12

How to manage poor cash flow

Answer 12

-cheaper supplies.
-sell equipment
-take out a bank loan

Question 13

What is gross profit

Answer 13

Profit from buying and selling

Question 14

Cost of ict within a business

Answer 14

-replacing and upgrading systems.
-new furniture to house equipment.
-staff training.
-computer viruses

Question 15

Benefits of using ict

Answer 15

Increased efficiency.
-increased flexibility
-access to new markets

Question 16

Advantages of capital intensive

Answer 16

Machinery doesn’t need breaks.
Fewer employees need to be paid.

Question 17

Disadvantages of capital

Answer 17

Expensive to buy machines.
-customer requirements can’t be met

Question 18

Advantages of Labour

Answer 18

Employees can be creative.
Labour is always available.

Question 19

Disadvantages of Labour

Answer 19

Expensive to recruit.
Quality of work can vary

Question 20

Stages of production

Answer 20

Input process and output.

Question 21

Factors to consider whilst choosing a supplier.

Answer 21

Price,quality, delivery time, quantity, storage space, reliability

Question 22

Types of operations

Answer 22

Job, flow and batch

Question 23

Advantages of job production

Answer 23

Customer exact demands can be met.
Hugh prices can be charged.
Designs can be changed.

Question 24

Disadvantages of job production

Answer 24

Products take longer to be made.
Bulk purchases of stock aren’t always available.

Question 25

Advantages of batch production

Answer 25

Can be changed to suit customers.
Cost savings can be made.

Question 26

Disadvantages of batch production

Answer 26

Resources may have nothing to do between each batch.
A fault in one item can lead to whole batch being wasted.

Question 27

Advantages of flow production

Answer 27

Large quantities of identical products.
Machinery can work 24-7

Question 28

Disadvantages of flow

Answer 28

Products can’t be made to customers individual requirements.
Fault or breakdown could stop whole line of production.