General Definitions

Question 1

Capital Expenditure

Answer 1

Rent - used to buy capital items, which are assets that will stay in the business for a long period of time. Capital items are non-current assets and intangible.

Question 2

Revenue Expenditure

Answer 2

Stock and Staff - spending on a day to day or regular basis. These are the expenses incurred by a business that are shown on the profit + loss account.

Question 3

Bonds + Gilts

Answer 3

Fixed term securities where the lender lends money to companies and government schemes.

Question 4

IFA

Answer 4

Financial advice offered by an industry professional - can charge high fees and advice not guaranteed.

Question 5

Price Comparison

Answer 5

Free 24/7 access, and simple to use. Sometimes biased, companies pay to get on top.

Question 6

Debt Counsellor

Answer 6

Services monitored by the FCS. Not free, only focuses on debt and not other financial matters.

Question 7

Individual Voluntary Agreements

Answer 7

Helps to manage personal debt, regular payment makes budgeting easier. Set-up handling fees, effects future ability to secure credit.

Question 8

Citizens Advice

Answer 8

Free service, run by volunteers. May not be financial experts, limited support may be available.

Question 9

Bankruptcy

Answer 9

Clears all debt, starts from scratch. Credit score goes to zero.