Finance for business growth

Profit that a business has saved from previous years is known as

• Net profit

• Gross profit

• Retained profit

A disadvantage of using retained profit to grow the business is..

• You have to repay it

• It can slow the rate of business growth down

• Its very risky

The benefits of using retained profit to fund business growth are.

• It doesn't have to be repaid

• Its quick

• You don't have to pay interest

• Its low risk

Retained profit is

• An internal source of finance

• An external source of finance

An asset is

• Money in the bank

• Something a business owns such as buildings or vehicles

• Something a business owes to the bank

Selling assets is

• An internal source of finance

• An external source of finance

A benefit of selling assets to raise capital is

• It is a quick way to raise capital

• It has to be repaid

• You can raise unlimited amounts of capital

A disadvantage of selling assets to raise capital is...

• You have to repay it

• It is expensive

• If the business grows, you may need to replace these assets

Loan capital is...

• An internal source of finance

• An external source of finance

All businesses that apply for a loan will get one

• True

• False