- 5.1.1 The need for business finance
- the main reasons why businesses need finance: start-up capital, capital for expansion/growth,
replacing existing non-current assets, investing in new technology, working capital - short-term and long-term finance needs of a business
- concept and importance of working capital
5.1.2 The main sources of finance - internal sources of finance: owners’ investment, retained profit, sale of unwanted assets, working
capital - external sources of finance: share capital or issuing shares, venture capital, bank overdrafts,
leasing, hire purchase, bank loans, trade credit, government grants, crowdfunding - advantages and disadvantages of internal and external sources of finance
- the main factors to consider when selecting a source of finance: size of business, legal form of
business, amount required, length of time, existing loans, cost, purpose - recommend and justify an appropriate source of finance for a given situation
Minimum Time = 40 minutes
