Internal Finance
External Finance
Vocabulary
100
The main source of finance for sole traders and partnerships.
What are personal funds?
100
Money raised from selling shares in a company.
What is share capital?
100
A financial decision making tool that helps managers to assess whether certain investment projects should be undertaken.
What is investment appraisal?
200
Source of finance where you don't need to pay back interest. However, it can be limited and cause disputes.
What is family and friends?
200
Investments in a company that are sold to the public to raise capital.
What are shares?
200
An investment appraisal technique which estimates the length of time needed to get the initial investment back.
What is payback period?
300
Money that is available for the daily running of a business.
What is working capital?
300
Allows businesses to temporarily overdraw on it's account.
What are overdrafts.
300
The purchase of an asset with the potential to yield future financial benefits.
What is an investment?
400
Money that is available for the daily running of a business.
What is working capital?
400
Allows businesses to 'buy now and pay later'. Organizations that offer this allow 30 to 60 days to pay.
What is trade credit?
400
The place where you buy or sell products.
What is a market?
500
Things that businesses own that they can sell for finance and liquidity.
What are assets?
500
Financial gifts from individuals or organizations to a business.
What are donations?
500
Money that is held in the business.
What is cash?
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