Internal Finance
External Finance
Vocab
100
Something businesses own that can be sold to raise capital.
What are assets?
100
These are financial gifts from individuals to a business.
What are donations?
100
The inflow of money to a business?
What is revenue?
200
A popular source of finance with sole traders. You don't usually need to pay interest.
What is Family or friends?
200
A source of finance where business provide support for displaying the company's brand or logo.
What is Sponsorship?
200
The outflow of money to a business?
What are costs or expenses?
300
The main source of finance for sole traders.
What is personal funds?
300
A short term source of finance that allows a company to temporarily overdraw on it's account.
What is a overdraft?
300
the difference between revenue-costs.
What is profit?
400
the value of profits that a business keeps.
What is retained profits?
400
Allows businesses to 'buy now and pay later'. Usually allows businesses 30 to 60 days to pay.
What is trade credit?
400
Spending money to buy assets that will yield financial gain in the future.
What are investments?
500
This source has the most liquidity. But there is an opportunity cost to using it.
What is extra cash?
500
Similar to trade credit but the creditor is not a supplier but a financial institution like American Express or Visa.
What are Credit cards?
500
the quantitative technique to calculate the financial costs and benefits of an investment decision.
What is investment appraisal?
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