Finance: key concepts

What is capital expenditure?

• The money the capital of a country spends

• Money spent on buying fixed assets such as machines

• Money spent that is more important to the CEO than employees

• Money spent on banks and other financial institutions

What is revenue expenditure?

• Money used in the day-to-day running of a business.

• Money received from sales

• Money that returns to the company

• Money received in the form of cash.

The correct definition of personal funds is:

• The money a person has in a bank at the moment.

• A source of money that comes essentially from a person's own personal savings.

• Money that is paid to an employee for a specific task done at a job.

• Money that is not shared with anyone because it is illegal.

Retained profit is:

• Profit that is confiscated by the government due to illegal activities.

• Money that remains after paying dividends to shareholders.

• Money that is used to pay dividends to shareholders.

• Money that the CEO keeps for his or her own personal use.

Sale of assets is:

• Only to be done by banks

• A good way of raising cash from assets that are not being used.

• An event companies prepare every year to throw the christmas party of their employees

• Not time consuming as assets are easily sold.

Share capital is:

• Money raised from the sale of shares of a limited company.

• Also known as equity capital

• Produced by shareholders

• Money that doesn't have to be repaid to shareholders.

Loan capital is:

• Money that is lent by shareholders to a company

• Money that is lent by a bank to a company

• Money that is raised from a company's event

• Money that is produced by the employees of a company.

An overdraft is:

• When a company writes a check to pay for an investment

• When a company is having excess of production

• When the bank allows the company to withdraw more money than it has in the bank account

• When banks are low on money and they borrow from companies.

When a business allows a buyer (in this case another company) to pay for a product or service at a later date is known as:

• Credit of payment

• Executive loan

• Trade union

• Trade credit

Crowdfunding is:

• When a large number of people fund a venture or project by contributing with small amounts of cash.

• When too many people want to earn money from a business

• A large group of banks collecting money from a business

• When too many people want to purchase a product such as the new I-phone.