Raising money

Question 1

3 internal finances (inside a business)

Answer 1

selling assets
retained profits
owners own capital

Question 2

5 external finances (outside a business)

Answer 2

family and friends
banks
peer to peer
business angels
crowd funding

Question 3

7 methods of finance

Answer 3

loan
share capital
venture capital
overdraft 
leasing
trade credit
grant

Question 4

venture capital is

Answer 4

money from an entrepreneur

Question 5

share capital is

Answer 5

issuing shares in return for cash

Question 6

trade credit is

Answer 6

suppliers allowing a number of days before payment

Question 7

limited liability is

Answer 7

investors losing the money they have put it

Question 8

unlimited liability is

Answer 8

when owners are responsible for all debts

Question 9

current assets are

Answer 9

things that can be turned into cash easily e.g. stock

Question 10

3 things a business plan includes

Answer 10

a marketing plan
an operational plan
a financial plan

Question 11

net cash flow is

Answer 11

total inflows - total outflows

Question 12

closing balance is

Answer 12

opening balance + net cash flow

Question 13

3 positives of cash flow forecast

Answer 13

can gain finance to cover shortfall
compare revenues
find problems and solutions

Question 14

2 negatives of cash flow forecast

Answer 14

assumptions have been made

unexpected events could happen

Question 15

4 ways to improve cash flow `

Answer 15

sell stock quickly
bank overdraft
pay suppliers later
debt factoring

Question 16

3 cash flow objectives

Answer 16

maintain minimum balance
spread costs more evenly
reduce overdraft