Unit 3 key words
- Created by: stuart symons
- Created on: 03-04-14 14:35
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- Financial management is the process of producing and interpreting accounts that record a business’s expected or actual costs, revenue and profits. This helps managers to take good decisions.
- Costs are the expenses pain by a business, such as its employees’ wages.
- Revenue is the income received by a business from selling goods and services.
- A budget is a financial plan for the future operations of the business. Budgets are used to set targets to monitor performance and control operations.
- A business plan is a detailed statement setting out the proposals for a new business or describing the ways in which an existing business will be developed.
- Cash flow is a measure of the amount of money moving into and out of a business over some time period.
- A sole trader is a business owned and operated by a single person.
- A company is any incorporated business.
- A partnership is a group of between 2 and 20 people who contribute capital and expertise to an enterprise.
- Shareholders are the owners of a company.
- Limited liability provides protection for the owners of a company (normally the shareholders). They only risk the amount they have invested in the business in the event of its failure.
- An external source of finance is an injection of capital into a business from individuals, other businesses or financial institutions.
- An internal source of finance is one that exists within the business.
- A share is a document representing part ownership of a company.
- Trade credit is a period of grace offered by suppliers before payment for goods and services is due.
- Assets are anything owned by a business from which it can benefit. Assets include land, vehicles, stocks and brand names.
- Collateral is the security offered to back up a request for a loan. Usually this is in the form of property, as this is unlikely…
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