Finance and Accounts

Types of Expenditure

100

Insurance premiums (give the category of expendture)

Revenue expenditure

200

R&D (indicate the category of expenditure)

Capital expenditure

300

Stocks of raw materials (give the category of expendture)

Revenue expenditure

400

Tools (indicate the category of expenditure)

Capital Expenditure

New Terms

100

unable to pay debts owed

insolvent

200

a primary market offer to the existing shareholders to buy additional shares of the company

A rihts issue

300

Define assets

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.

400

Define liabilities

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)

Internal sournces of finance

100

Name 3 sources of internal sources of finance

• personal funds
• retained profit, and
• the sale of assets.

200

Another name for retained profit

ploughed-back profit

300

Retained profit does not incur any interest charges. TRUE OR FALSE?

True

400

Fixed assets are items a business owns and uses for a period of more than 6 months. TRUE or FALSE?

False (12 months)