Unit 5 Business As-Level Definition

What is Start-up capital?

• Funds used to buy raw materials

• Finance needed when setting up a business

• A loan from shareholders

• Profit reinvested into the business

What is Working capital?

• Funds for purchasing equipment

• Capital needed for day-to-day operations

• Finance for long-term growth

• Loans taken from banks

What is Short-term finance?

• Finance needed for operations under one year

• Finance repaid over a decade

• Finance used to buy shares

• Funds provided by venture capitalists

What is Long-term finance?

• Finance used for short-term expenses

• Finance repaid over many years

• A small loan from shareholders

• Income from selling products

Define Profit.

• The amount spent on wages

• Total revenue minus total costs

• Total revenue earned by selling products

• Loans from other businesses

What is Liquidity?

• Ability to turn assets into cash

• Long-term financial stability

• Debt-to-equity ratio

• Total profit earned by a business

What is Administration?

• A loan taken from a bank

• Managing business operations and resources

• Funds for purchasing equipment

• Liquidation of assets

Define Bankruptcy.

• The liquidation of assets

• The inability to meet financial obligations

• The sale of a company

• A bank's loan repayment process

What is Liquidation?

• Selling assets to raise capital

• The process of a business closing down and selling assets

• Investing in new equipment

• A form of short-term finance

What are Current assets?

• Assets converted to cash within a year

• Long-term investments in the company

• Equipment and machinery

• Business loans