Finance Flashcards
1
Q
Bank loan
A
1-7yrs
Paid with interest
2
Q
Overdraft
A
Paid monthly
High interest
*Taken out of the bank when needed
3
Q
Mortgage
A
25 years
A long term loan secured against an asset
*normally a building
4
Q
Dividend
A
Yearly bonus profit to shareholders
A share of the profit to be paid to shareholders
5
Q
Retained profit
A
Is the profit kept in the company rather played out to shareholders as a dividend
It is the most important long term source of finance for a business
6
Q
Bank loan
A
Lump sum Clear terms and conditions May also get support Disadvantage-interests payments Strict conditions Needs to be agreed
7
Q
Overdraft
A
Flexible
Provides back up
Disadvantage-high interest
Can be withdrawn
