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Flashcards in Sources of finance Deck (18)
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1

Asset

An item of property owned by a person or company.

2

Cash flow

The movement of money in and out of the business.

3

Cost of borrowing

Cost of borrowing is the interest charged on a bank loan.

4

Credit arrangement

A credit arrangement is a contract made between a business and a supplier. It outlines when payments must be made.

5

Credit check

A credit check is when a company looks at the financial information held on a business or an individual to determine whether they are creditworthy (eg suitable to lend money to) and reliable.

6

Crowdfunding

Crowdfunding is raising money from a large number of people who contribute small amounts, usually online.

7

Dividends

A sum of money paid regularly by a company to its shareholders out of its profits.

8

Entrepreneur

A calculated risk-taker who sets up a business in return for financial gain.

9

Founder

A business founder is an individual or group of individuals who create a business.

10

Guarantor

A person who guarantees a loan or payment. If the person or business taking out the loan does not pay, the guarantor pays instead.

11

Investment return

The amount of money that is received in return for investing in a business.

12

Ordinary shares

A share of a company entitling its holder to dividends which vary in amount depending on whether the company has a good or bad year.

13

Overdraft

An agreement with the bank to overspend on an account.

14

Permanent capital

Permanent capital is a source of finance that never has to be paid back.

15

Share capital

The money raised when a business becomes a public limited company by offering shares in the business in return for capital.

16

Shareholder

A part owner of a private or public limited company.

17

Trade credit

The ability to buy stock now and pay for it at a later date.

18

Venture capitalist

A venture capitalist is an individual who invests money in a start-up business in return for a share of the business and/or the profits.