BTEC National Level 3 Business Unit 3 Personal
and Business Finance Questions and Answers
100% Solved
Fixed/Non-current Liabilities Owed by the business that aren't likely to change on a
regular basis
Net assets Non-current assets + current assets - (current liabilities + long term liabilities)
Depreciation
Profit or loss for the year gross profit - expenses + other income
Gross profit sales revenue - cost of goods sold
Cost of goods sold opening inventory + purchases - closing inventory
Sales Turnover/Sales Revenue Number of units sold x selling price
,Prepayments when an expense is paid in advance
Accruals when an expense is paid after
Tangible assets An asset that can be touched
Intangible assets An asset that cannot be touched
Childhood (life stages) - Limited Needs
- Mainly reliant on parents
- May want to buy sweets or toys
Teenager (life stages) - Want to be more independent
- Slightly less reliant on parents as want to socialise away from family
Young Adult (life stages) - University or starting a career
,- Looking to be more independent
- Buying a car and buying or renting a flat or house
- Looking to settle down and maybe get married or start a family
Middle age (life stages) - Support Family
- Start saving for children's futures
- Look to improve own lifestyle
- Enjoy access to additional money to spend on luxuries such as going abroad
Old age (life stages) - Fewer dependents
- May downsize life e.g. Move to a smaller house
- Fewer financial needs for assets but may be higher for services such as health care
Debt Money owed
Credit Rating A score given to individuals on how likely they are to repay debts based
upon their previous actions.
, Bankrupt When an individual or an organisation legally states its inability to repay debts
Solvent The ability to meet day-to-day expenditure and repay debts
Current account An account with a bank or building society designed for frequent use
Standard Current Account Advantages
- No charges on credit balances
- Offers the holder a wide range of facilities including a cheque book, debit/cash card and
possibly an overdraft facility
Disadvantages
- Potentially high charges on overdraft
- No additional Perks
Premium Current Account Advantages
- No charges on credit balances
and Business Finance Questions and Answers
100% Solved
Fixed/Non-current Liabilities Owed by the business that aren't likely to change on a
regular basis
Net assets Non-current assets + current assets - (current liabilities + long term liabilities)
Depreciation
Profit or loss for the year gross profit - expenses + other income
Gross profit sales revenue - cost of goods sold
Cost of goods sold opening inventory + purchases - closing inventory
Sales Turnover/Sales Revenue Number of units sold x selling price
,Prepayments when an expense is paid in advance
Accruals when an expense is paid after
Tangible assets An asset that can be touched
Intangible assets An asset that cannot be touched
Childhood (life stages) - Limited Needs
- Mainly reliant on parents
- May want to buy sweets or toys
Teenager (life stages) - Want to be more independent
- Slightly less reliant on parents as want to socialise away from family
Young Adult (life stages) - University or starting a career
,- Looking to be more independent
- Buying a car and buying or renting a flat or house
- Looking to settle down and maybe get married or start a family
Middle age (life stages) - Support Family
- Start saving for children's futures
- Look to improve own lifestyle
- Enjoy access to additional money to spend on luxuries such as going abroad
Old age (life stages) - Fewer dependents
- May downsize life e.g. Move to a smaller house
- Fewer financial needs for assets but may be higher for services such as health care
Debt Money owed
Credit Rating A score given to individuals on how likely they are to repay debts based
upon their previous actions.
, Bankrupt When an individual or an organisation legally states its inability to repay debts
Solvent The ability to meet day-to-day expenditure and repay debts
Current account An account with a bank or building society designed for frequent use
Standard Current Account Advantages
- No charges on credit balances
- Offers the holder a wide range of facilities including a cheque book, debit/cash card and
possibly an overdraft facility
Disadvantages
- Potentially high charges on overdraft
- No additional Perks
Premium Current Account Advantages
- No charges on credit balances
