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WorksheetsG11 - Knowledge on Funding
Total questions: 26
Worksheet time: 13mins
An amount of money that is paid back within an agreed amount of time, with interest
Bank loan
Angel investment
Overdraft
Retained profit
A short-term source of finance from a bank that usually is only used in an emergency/when needed
Overdraft
Loan
Share capital
Credit card
Funds that are required to purchase fixed assets like land and building, plant and machinery, and furniture and fixtures is known as
fixed capital
working capital
Case study: after years of success and growth, Shark Tank success story Lumibowl (a clip-on light that illuminates your toilet bowl so you 'hit your target' in dark of night!) is ready to grow extensively into other countries. It needs huge amounts of money in order to do so. Which source of finance would be a good fit?
Raising share capital by transforming from a partnership to a public corporation
Taking advantage of the agreed overdraft with the bank
Retained profits of $80,000
Crowdfunding
Which of the following would be the most appropriate source of finance for a new business (which is just launching) that makes mobile phone accessories?
Retained Profit
Sale of Assets
Share Capital
Friends and family
Which of the following is NOT usually considered a personal source of finance.
Savings
Redundancy payments
Crowdfunding
Credit card
Which of the following statements about personal sources of finance is false?
Often cheaper in the long-term
Less 'red tape' or delay in getting the cash
Less personal financial risk for the entrepreneur
May be harder to raise large amounts
An amount of money that is paid back within an agreed amount of time, with interest
Bank loan
Angel investment
Overdraft
Retained profit
What type of finance involves less profit going to the owners?
Retained profit
Sale of assets
Overdraft
Owner's capital
What is an advantage of a business using owner's capital as a source of finance?
Very low rate of interest
It will bring new skills to the business
It doesn't need repaying
Repayment is always spread over a period time
What is the most likely source of finance for a small firm?
A debenture
Issuing shares
A bank loan
Raising funds from a wide variety of small investors by publicising an idea on the internet is called:
Share capital
Venture capital
Crowdfunding
Trade credit
Which one of the following correctly defines insolvency?
where the value of items owned is greater than the value of money owed
where costs exceed the total revenue
where the value of inputs is greater than the value of outputs
where debts are unable to be met when they are due to be paid
Name the investors who get priority over equity shareholders while paying dividend and repayment of capital
preference shareholders
debentureholders
retained earnings
When an entrepreneur takes out loans to finance their business, this is called...
equity financing
bootstrapping
debt financing
preferred stock
