Theme 2
Managing business activities
d
e
,2.1
raising finance
,2.1.1
internal finance
• a) Owner’s capital: personal savings
• b) Retained profit
• c) Sale of assets
, Businesses need finance to start up, pay costs (fixed/variable), wages and raw materials. Can pay for d
they use trade credit – get stock now, pay in 30, 60 or 90 days, improves cash flow.
• Owners capital – amount of money the owners invests from their own pockets, or from a loan
• Retained profits – once all expenses paid for, the left over is profit and can be reinvested into the b
• Sale of assets – assets which aren't needed anymore can generate money for something new
Managing business activities
d
e
,2.1
raising finance
,2.1.1
internal finance
• a) Owner’s capital: personal savings
• b) Retained profit
• c) Sale of assets
, Businesses need finance to start up, pay costs (fixed/variable), wages and raw materials. Can pay for d
they use trade credit – get stock now, pay in 30, 60 or 90 days, improves cash flow.
• Owners capital – amount of money the owners invests from their own pockets, or from a loan
• Retained profits – once all expenses paid for, the left over is profit and can be reinvested into the b
• Sale of assets – assets which aren't needed anymore can generate money for something new
