Terms
Sources of finance for revenue expenditure. It is also used to solve working capital problems
Short term finance
Name 3 sources of medium-term finance
Bank loans, subsidies, leasing, ...
Venture capital is a common source of finance for what kind of businesses?
Start-ups
Property a business owns and uses for a period of 12 months or longer, and it generates income for the organization
Fixed assets
What business operations should long term finance be used for, give an example
Long lasting operations such as growth and expansion, e.g., acquisition of a smaller company
What kind of interest is paid on debentures?
Fixed interest
Form of government assistance provided to encourage firms to increase their output of certain goods and services
Subsidies
What source of finance is not appropriate for a business with liquidity problems?
Loan capital
Bank overdraft is good for covering what kind of business costs?
Variable costs
When company sells its shares for the very first time on a stock exchange?
Initial Public Offering (IPO)
What is another term for gearing ratio in business?
Debt to equity ratio
What is the major disadvantage of subsidies for businesses?
They can be withdrawn at a short notice