Sorces of Finance and More

Question 1

What is Qualitative Research

Answer 1

This research is based on feelings, thoughts and opinions

Question 2

What is Quantitative Research

Answer 2

This research is based on stats and numbers.

Question 3

Three qualities of entrepreneurs

Answer 3

Calculated risk takers, Clear vision and goals and Resilience.

Question 4

Breaking Even

Answer 4

When the total revenue is equal to the total costs, at this point a business is making neither a loss or a profit
Fixed costs/( selling price - Variable costs)

Question 5

Margin of safety

Answer 5

The difference between the actual level of sales and the breakeven point.

Question 6

Trade Credit

Answer 6

A business obtains its stock from suppliers, but doesn’t pay immediately, average credit period is 2 months.

Question 7

Share Capital

Answer 7

Selling shares as a business for cash

Question 8

Debenture

Answer 8

A very long term loan secured against an asset ( usually 25 years ).

Question 9

Long Term

Answer 9

For future expansion and assets

Question 10

Short Term

Answer 10

For day to day running costs

Question 11

Trade Credit

Answer 11

A business gets stock from suppliers but doesn’t pay immediately, average credit period is 2 months

Question 12

Bank Overdraft

Answer 12

Allows you to withdraw slightly more money than you actually have in your account, usually between 100 to 1000 pounds.

Question 13

Retained profit

Answer 13

Profits retained from the previous year that can be reinvested in the business

Question 14

Grants

Answer 14

Money from the government to help your business that doesn’t have to be paid back

Question 15

Selling Shares

Answer 15

Selling some future profits and control of your business fir cash

Question 16

Selling fixed assets and leasing back

Answer 16

Selling an assets and using the profits made to lease out a better version of that item

Question 17

TOTAL COST

Answer 17

TFC (total fixed costs) + TVC (total variable costs)

Question 18

REVENUE

Answer 18

Revenue = Price × Quantity

Question 19

Break Even Point Units

Answer 19

Fixed Cost/(Sales Price – Variable Costs)

Question 20

Break Even Point In Revenue

Answer 20

Break Even Point In Units × Sales Price

Question 21

Margin Of Safety

Answer 21

Actual Or Budgeted Sales − Break Even Sales

Question 22

Interest(On Loans) In %

Answer 22

Total Repayment Borrowed Amount x100/Borrowed Amount

Question 23

Net Cash-flow

Answer 23

Cash Inflows − Cash Outflows In A Given Period

Question 24

Opening Balance

Answer 24

Closing Balance Of The Previous Period

Question 25

Closing Balance

Answer 25

Opening Balance + Net Cash-flow