3.1 Sources of Finance & 3.2 Costs and Revenues
3.3 Break-even analysis & 3.4 Final Accounts
3.5 Profitability and Liquidity ratio analysis
3.7 Cash Flow & 3.8 Investment Appraisal
Wild Card Questions
100
What is short term finance?
Refers to sources of finance needed for the day-to-day running of a business, i.e. its revenue expenditure. It is also often used to solve cash flow (working capital) problems. Short-term finance comprises finance that lasts no longer than one year.
100
Definition of break-even quantity
The break-even quantity (BEQ) is the level of output where a business does not make either a profit or a loss.
100
What is capital employed?
Capital employed is the value of all sources of finance for a business, including internal and external finance. It is calculated using the formula: Loan capital (or long-term liabilities) + Share capital + Accumulated retained profits.
100
Definition of current assets
Current assets are the short-term assets (belongings) of an organization that can be relatively easy to convert into cash. Typical examples include cash, stocks (inventory), and debtors:
100
How old was Emma Raducanu when she won the US Open in 2021?
A. 17
B. 18
C. 19
D. 21
B. 18
200
List 3 sources of finance
transactions fees charged to customers
membership fees
royalties
merchandise sales
sponsorship revenues
subscription charges imposed on customers
dividends from shareholdings in other companies
donations/gifts
interest earnings from cash savings in a bank account
grants and subsidies from the government
200
What is the colour of the sky?
Blue
200
What is return on capital employed? (ROCE)
The return on capital employed (ROCE) is a profitability ratio that measures a firm’s efficiency and profitability in relation to its size (as measured by the value of the organization’s capital employed). It is calculated using the formulas: ROCE = (NPBIT / Capital employed) × 100.
200
What is the working capital cycle?
200
Who was the highest paid model in 2021?
A. Rosie Huntington-Whitely
B. Kendall Jenner
C. Adriana Lima
D. Gigi Hadid
B. Kendall Jenner
300
List 5 sources of external finance
share capital
loan capital
overdrafts
trade credit
grants
subsidies
debt factoring
leasing
venture capital, and
business angels
300
Definition of an assets and liabilities
Assets are the possessions of a business with a monetary value. Assets are owned by a business. Typical examples include: buildings, land, machinery, equipment, stocks (inventories) and cash.
Liabilities are the debts of a business, i.e. the money owed to others. Typical examples include any money owed to financiers (such as banks), trade creditors, and the government (for profits tax).
300
Gross Profit Margin formula
Gross Profit Margin (GPM) = (Gross profit/Sales Revenue) x 100
300
Formula for working capital
Working capital = Current assets – Current liabilities
300
How old is Adele?
A. 28
B. 31
C. 33
D. 35
C. 33
400
What are indirect (overhead) costs? Give one example
- Indirect costs (or overhead costs) are costs that are not easily identifiable with the sale or output of a specific good, service, department, or business operation.
Examples of indirect costs include: rent on premises, salaries paid to administrative staff, fees paid for legal and accounting services, utility bills, general insurance (for third parties, fire and theft).
400
Formula for break-even quantity
Fixed Costs/Selling Price-Average variable cost (UC)
400
What are a firm's liquid assets comprised of?
- cash
- stocks (also known as inventories), and
- debtors
400
Max’s Macaroons is considering purchasing a patisserie oven at a cost of $12,000. The business expects the useful life of the oven to be 6 years, and forecasts that it will generate revenue of $30,000 over the period. What is the average rate of return?
A. 20%
B. 15%
C. 30%
D. 25%
D. 25%
400
How many nominations did 'West Side Story' recieve in the 2022 Oscars?
A. 6
B. 7
C. 10
D. 0
C. 7
500
Factors to consider when examining the choice of alternative sources of finance? (Clue, Remember SPACED when discussing different sources of finance for a business)
Size of firm
Purpose of finance
Amount required
Costs
External influence
Duration
500
A surfboard producer has variable costs of $420 per unit and sells each one for $500. The fixed costs are $12,000 per month. How many surfboards does the firm need to sell each month in order to break-even?
A. 150
B. 80
C. 200
D. 149
A. 150
500
Acid Test Ratio formula
(Current assets - Stocks)/Current liabilties
500
The net present value (NPV) is the numerical difference between the total values of future net cash flows expressed in today’s (the present) value and the cost of the investment project or decision. In other words, the NPV is found by adding up the discounted values of all future net cash flows and then deducting the cost of the investment project. What is the formula?
NPV = Sum of Present Values – Cost of Investment
500
Bitcoin plunges below _ as tensions between Russia and Ukraine climb
A. $1900
B. $103,000
C. $28,000
D. $37,000
D. $37,000