What are the sources of finance used mostly by sole traders and partnerships?
100
Share capital
What is the main source of finance for a limited company?
100
Long-term source of finance for limited companies
What is share capital?
100
The period of time for an investment project to earn enough points to repay the cost of the initial investment.
What is the payback period?
100
A financial decision-making tool that helps managers assess whether certain investment projectss should be taken. Based mostly on quantitative techniques.
What is Investment Appraisal?
200
Retained profits
What type of finance (after taxes and dividends have been paid) is often used to by a business to purchase or upgrade fixed assets?
200
Initial Public Offering
What is it called when a business floats its shares on a stock exchange for the first time ('goes public')?
200
More than 12 months but less than five years.
What is the time frame for "medium-term"
200
A method used to convert the future net cash flow to it present value today. It represents either inflation or interest rates.
What is a discount factor?
200
A technique that reduces the value of money that a business receives in future years because there is an opportunity cost to money.
What is Discounted Cash Flow?
300
Dormant Assets
What are unused assets?
300
This source of finance allows firms the chance to use assets without having to pay for them in one lump sum. Once the final instalment is payed, the asset legally belongs to the business.
What is Hire Purchase?
300
Any period after the next 5 years
What is the time frame for "long-term"
300
This quantitative method is expressed in percentage terms and allows managers to calculate and compare the average profit on possible investment projects.
What is the Accounting or Average Rate of Return?
300
Working Capital (aka net current assests)
What is the day to day money that is available to a business?
400
Working Capital
What is the money available for the day-to-day running of a business?
400
The most common type of shares issued by a limited company, which gives holders voting rights and dividneds based on the company's profits.
What are ordinary shares?
400
One fiscal year or 12 months
What is the time frame for "short-term"
400
The Net Present Value
What is the sum of all future expected net cash flows minus the investment cost?
400
A wealthy and entrepreneurial investor who risks their money in small to medium sized businesses that have high growth potential.
What is a business angel?
500
Interest that could have been earned by placing money in the bank.
What is the opportunity cost of keeping cash at hand rather than at the bank?
500
The debt factoring service that allows the client to be protected against bad debts.