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Sources of Financing

Total questions: 10

Worksheet time: 5mins

Name
Class
Date
1.

These are a form of ordinary shares, which are entitled to a dividend only after a certain date or if profits rise above a certain amount.

a)

Equity Shares

b)

Deferred ordinary shares

c)

Retained earnings

d)

Bonus shares

2.

It provides a way of raising new share capital by means of an offer to existing shareholders, inviting them to subscribe cash for new shares in proportion to their existing holdings.

a)

Right issue

b)

Dividend shares

c)

Equity sharers

d)

Retained earnings

3.

Have a fixed percentage dividend before any dividend is paid to the ordinary shareholders.

a)

Bonus shares

b)

Common shares

c)

Preference shares

d)

Retained earnings

4.

It is long-term debt capital raised by a company for which interest is paid, usually half yearly and at a fixed rate.

a)

Loan shark

b)

Loan Stock

c)

Bank loan

d)

Bonds

5.

Defined as the written acknowledgement of a debt incurred by a company, normally containing provisions about the payment of interest and the eventual repayment of capital.

a)

Bond

b)

Mortgage

c)

Loan stock

d)

Debenture

6.

A loan at a variable rate of interest is sometimes referred to as

a)

Fixed rate

b)

Floating rate loan

c)

Variable rate

d)

Lien

7.

It is an agreement between two parties, the "lessor" and the "lessee".

a)

Franchise

b)

Lease

c)

Contract

d)

Agreement

8.

These are lease agreements between the user of the leased asset (the lessee) and a provider of finance (the lessor) for most, or all, of the asset's expected useful life.

a)

Franchise

b)

Finance franchise

c)

Finance Lease

d)

Lease

9.

It is similar to leasing, with the exception that ownership of the goods passes to the hire purchase customer on payment of the final credit installment, whereas a lessee never becomes the owner of the goods.

a)

Hire loan

b)

Hire credit

c)

Hire purchase

d)

Hire lease

10.

It is money put into an enterprise which may all be lost if the enterprise fails

a)

Initial capital

b)

Venture capital

c)

Working capital

d)

Owners equit