ch.19 - business finance

why business need finance?

• To set up expenses

• To learn latest technology

• set up start up capital

• finance expansion

finance that owner use to set up a business known as a

Day to day expenses also known as

give example of expansion of a business?

• Reducing the range of products or services offered
• Opening new locations, introducing new products , entering new markets

• Closing down existing locations
• Focusing only on existing customer segments

Which one is NOT internal source of finance?

• personal savings

• Bank loan
• Personal savings
• sales of fixed asset

explain retained profit

Explain two reasons why cemex needed to raise finance from the sale of assets?

Do you think selling assets was the best source of finance for cemex to use to pay off its debt? Justify your answer

how do you raise additional funds through working capital?

• deducting accounts receivable collection

• Investing in long-term assets
• reduce inventory

• Decreasing accounts payable terms

what is leasing?

• A process of gifting a vehicle or other asset for a fixed period of time
• A process of borrowing a vehicle or other asset without making any payment
• A process of obtaining the use of a vehicle or other asset for a fixed period of time in exchange for a periodic payment.
• A process of buying a vehicle or other asset outright with a one-time payment