Edexcel IAL Business Unit 2 – Key

Definitions and Formulas

Internal finance - ANSWER...-Money generated from within the business (e.g. retained

profit, owner's capital).

External finance - ANSWER...-Money sourced from outside the business (e.g. loans,

overdrafts).

Owner's capital - ANSWER...-Personal savings invested by the business owner.

Retained profit - ANSWER...-Profit kept in the business after tax and dividends.

Sale of assets - ANSWER...-Selling business-owned items to ra...