WorksheetsHigher BM - Finance
Total questions: 24
Worksheet time: 12mins
The Finance Department are responsible for:
Ensuring all employees are working effectively across all areas.
Ensuring that funds are available for the organisation to achieve it's objectives.
Supporting the business to market their products and services effectively.
Generating financial information for support decision making.
Monitoring the levels of service that the organisation is delivering.
The finance department will complete various functions, such as:
Creating job adverts for new vacancies in the organisation.
Prepare budgets for departments to use.
Dismiss staff if they do not stick to agreed budgets.
Pay the salaries and wages of the employees.
Work with the managers to increase the reputation of the business.
The source of finance that a business will use depends upon:
The size of the business
The sector they operate in
How much money the competitors have
The weather
The town they operate in
Retained Profits is an example of:
Internal Finance
External Finance
Unsensible Finance
Long-Term Finance
The quickest source of finance available to a business is:
Retained Profits
Mortgage
Bank Loan
Sale of Assets
Short-term finance includes:
Bank Overdraft
Trade Credit
Debt Factoring
Mortgage
Bank Load
A bank loan can be a useful source of finance, because:
It allows the business to plan better
It is paid back with interest
The payments are usually a fixed amount
When using Hire Purchase, the business does not own the item...
True
False
Venture Capitalists can help a business if:
They want a low interest loan
Their credit rating is low
They are a multinational
They operate in the public sector
Sole traders, when just starting up, are usually financed by:
Share issue
Mortgage
The owners savings
Hire purchase
An advantage of taking out a bank loan is:
Can be repaid over a longer period of time
It is quick and easy to set up
Can agree a certain amount with the bank
there is no advantage to a bank loan
A Government Grant is
Money paid from the Government
Money that doesn't need to be paid back
Very difficult to get
All of the above
What is a fixed cost?
Costs that stay the same no matter the output
Costs that change depending on output
What is an example of a fixed cost:
Loan Repayments
Wages
Electricity
Purchases
What is a variable cost
Costs that stay the same no matter the output
Costs that change depending on output
Which of the following is an example of a variable cost?
Loan Repayments
Rent
Insurance
Electricity
What is the Break-Even point
The point where the total costs matches the total revenue
The point where the business is not making a profit or loss
The point where the business is just covering their costs
All of the above
What is meant by Revenue?
The money the business receives through selling
The money the business received from the bank
The tax a business pays on its profits
The name given to the profit the business makes
Which of the following could be a possible solution to many cash flow issues?
Giving your customers more time to pay debts
Taking out a bank loan to help cover costs
Owners taking more drawings from the business
A Liquidity ratio...
Measures how profitable the organisation is
Measures how able the organisation is to pay its short-term debts
Measures how well the capital invested into the company is being utilised
A profitability ratio...
Measures how able the organisation is to pay its short-term debts
Measures how well the capital invested into the company is being utilised
Measures how profitable the organisation is
Define 'working capital'
How easily an organisation can pay its short term debts
Payment to shareholders for having shares in a company
Selling shares on the stock market
Define a 'creditor'
People who owe the organisation money
People whom the organisation owes money
Define a 'debtor'
People who the organisation owe money to
People who owe the organisation money
