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WorksheetsS2 BDL - Financing a Business
Total questions: 14
Worksheet time: 12mins
What is interest in the context of financing a business?
A share of the company's profits
Money paid in addition to the amount of money borrowed
A fixed monthly payment for using banking services
The principal amount of money borrowed from a bank
What is a loan?
A gift of money that does not need to be repaid
A tax imposed on the company's revenue
Money borrowed which must be repaid with interest
A financial reward for the company's employees
What is a grant?
A legal document outlining the terms of employment
Money borrowed from investors in exchange for equity
Money which often does not have to be repaid
A penalty fee for late payment of debts
What is debt?
The total assets of a company
An amount of money that is owed (needing to be repaid)
The financial statement of a company
A donation made to the business by a charitable organization
What does every business need to get up and running?
A) A business plan
B) Finance
C) A marketing strategy
D) A customer base
Where can a business owner possibly get money to start their Café?
A) Personal savings only
B) Bank loans only
C) Government grants only
D) Personal savings, bank loans, and government grants
What is a benefit of using owner's savings to finance a business?
You have to pay interest on the borrowing
It is paid back in installments
You do not have to pay interest on the borrowing
It has to be paid back to the government
What is a characteristic of a bank loan when financing a business?
It does not have to be repaid
It is money given from the government
It is paid back over time with added interest
It is used to improve unemployment in an area
What is a government grant?
A sum of money that has to be repaid with interest
Money given from the government to the business that does not have to be paid back
An investment from your savings account
A loan that is paid back in installments
Under what condition might a business receive a government grant?
When it agrees to pay back the sum with interest
When it uses owner's savings for financing
When it meets certain conditions, such as improving unemployment in an area
When it takes a bank loan
A bank loan is an agreed sum of (a) paid back over time with added (b) .
Organise these options into the right categories
Must meet certain criteria
Must be used for specific projects
Requires application process
May have restrictions on usage
Does not need to be repaid
Provided by the government or non-profit organizations
Pay interest
Personal funds set aside by the business owner
Can be used for any business purpose
Owner's contribution to the business
Repaid with interest
Repaid in instalments
Match the following
money that is invested by the owner from their own personal funds
Owner's Saving
fixed amount of money usually awarded by the government
Bank Loan
it is a fixed amount of money that is given to a business repaid with interest
Government Grant
Define the term 'bank loan'
Choose the best answer:
A bank loan is a long term source of finance. It is a fixed amount of money that is given to a business by the bank that has to be repaid over time with interest, usually in monthly instalments.
A bank loan is a fixed amount of money usually awarded by the government, EU (European Union) or charitable organisations.
A bank loan is money that is invested by the owner from their own personal funds.
A bank loan is an amount of money given to a business from the bank.
