Sources of Finance Terms

Question 1

Owners Funds

Answer 1

Money put into the business by owner(s)

Question 2

Money put into the business by owner(s)

Answer 2

Owners Funds

Question 3

New Share Issue

Answer 3

Selling new shares to people or existing shareholders

Question 4

Selling new shares to people or existing shareholders

Answer 4

New Share Issue

Question 5

Overdraft

Answer 5

A flexible loan which businesses can use whenever necessary up to an agreed limit

Question 6

A flexible loan which businesses can use whenever up to an agreed limit

Answer 6

Overdraft

Question 7

Friends and family loan

Answer 7

Borrowing from friends and family

Question 8

Hire purchase

Answer 8

Purchasing assets and paying in installments

Question 9

Purchasing assets and paying in installments

Answer 9

Hire purchase

Question 10

Trade Credit

Answer 10

A period of time which suppliers allow customers before payment for supplies must be made

Question 11

A period of time which suppliers allow customers before payment for supplies must be made

Answer 11

Trade Credit

Question 12

Mortgage

Answer 12

A special type of loan to buy property

Question 13

A special type of loan to buy property

Answer 13

Mortgage

Question 14

Bank Loan

Answer 14

Money lent to a business from the bank

Question 15

Money lent to a business from the bank

Answer 15

Bank Loan

Question 16

Retained profits

Answer 16

Profit made by the business in previous years

Question 17

Profit made by the business in previous years

Answer 17

Retained profits

Question 18

Government Grant

Answer 18

A sum of money given to a business

Question 19

A sum of money given to a business

Answer 19

Government Grant

Question 20

Selling Assets

Answer 20

Selling something that business owns such as machinery

Question 21

Selling something that business owns such as machinery

Answer 21

Selling Assets