Theme 2 key terms Flashcards
source of finance
places from which business may gain finance
internal source of finance
place where business gain finance from within business
owners capital
personal savings or share capital raised
retained profit
profit left
after cost of sales, fixed overheads, tax financing costs paid
re-invest in business
external source of finance
place business gain finance from outside business
collateral
something of value
used as security when loan offered
peer to peer lending
websites
match up businesses wanting to borrow with investors looking for projects
business angel
individual invest in early stage of risky business
take equity share in return for providing finance, advice, guidance
crowdfunding
many small investors fund a project
through website/portal
share capital
finance raised from selling of shares
venture capital
provision of finance from professional investors
in return for equity (or loans)
often riskier projects
overdraft
facility provided by bank
depositors can go into negative balance in bank account
leasing
asset is rented not purchased
trade credit
business able to buy now pay later for supplies
grants
money given by government/local council to businesses
making positive difference in community
