iGCSE Business FInance Revision

Which of the following is not true of a debenture?

• Debenture holders get a fixed rate of return

• They must be repaid on an agreed date

• All businesses can have debenture holders

• Debenture holders are creditors of the company

Which of these sources of finance is internal?

• retained profit

• mortgage

• share capital

• crown funding

A rights issue involves the sale of what?

• new shares on the stock market

• fixed assets

• new shares to existing shareholders

• parts of the business

A business can have better control over its cash flow if it:

• operates an efficient credit control system

• keeps up to date records of financial transactions

• always plans ahead by producing a cash flow forecast

• pays all of its bills on time

Cash and profit are different because...

• some goods are sold on credit

• owners put more money into their business

• the opening balance at the start of the year is zero

• companies might buy fixed assets

Net cash flow is calculated as Total outflows minus Total inflows?

• TRUE

• FALSE

Contribution (in Break even analysis) is calculated as Selling price - variable cost per unit

• TRUE

• FALSE

An increase in fixed costs will do which of the following

• shift the break even point to the left

• make the total cost function steeper

• shift the breakeven point to the right

• make the total cost function flatter

A break even chart does not show what?

• the margin of safety

• how much output a business has to produce to break even

• how much money a business will make at the break even point

• costs, revenue and profit at different levels of output

Cost of sales is the same as:

• Fixed costs

• variable costs

• total costs

• average costs