Business Studies - 0450 CIE

The Need For Business Finance:

Gbogbo ọrọ náà

Every business needs money before it can make money. From the first rent payment to the machinery that fills the factory, finance is the fuel that gets a business moving and keeps it running. Knowing exactly why and when a business needs finance is the first step to choosing the right source for it.

In this lesson you will learn the main reasons businesses need finance, from start-up capital to working capital, and the crucial difference between short-term and long-term finance needs. You will be able to match a particular need to the right kind of finance and explain why the match matters.

Ebumnobi

  1. The main reasons why businesses need finance, e.g. start-up capital, capital for expansion and additional working capital
  2. Understand the difference between short-term and long-term finance needs

Nkuzi Olu

Gee ntị na nkuzi a na ngwa

Maapụ uche

E seela isiokwu a ka ị hụ otu echiche si ejikọta.

Mepee maapụ uche na ngwa

Kaadị ncheta

Omume ncheta ngwa ngwa n'ihe a na-anwale n'isiokwu a.

Mee omume kaadị ndị a na ngwa

Akwụkwọ Ọmụmụ

Many businesses fail not because they are unprofitable but because they run out of cash at the wrong moment. Understanding why finance is needed, and whether the need is short-term or long-term, lets a business plan ahead and avoid that trap. The exam reliably tests these reasons and the short-term versus long-term split.

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Nnyocha Ọmụmụ

Ekele diri gi maka imecha ihe karịrị na The Need For Business Finance:. Ugbu a na ị na-enyochakwa isi echiche na echiche ndị dị mkpa, ọ bụ oge iji nwalee ihe ị ma. Ngwa a na-enye ụdị ajụjụ ọmụmụ dị iche iche emebere iji kwado nghọta gị wee nyere gị aka ịmata otú ị ghọtara ihe ndị a kụziri.

Ị ga-ahụ ngwakọta nke ụdị ajụjụ dị iche iche, gụnyere ajụjụ chọrọ ịhọrọ otu n’ime ọtụtụ azịza, ajụjụ chọrọ mkpirisi azịza, na ajụjụ ede ede. A na-arụpụta ajụjụ ọ bụla nke ọma iji nwalee akụkụ dị iche iche nke ihe ọmụma gị na nkà nke ịtụgharị uche.

Jiri akụkụ a nke nyocha ka ohere iji kụziere ihe ị matara banyere isiokwu ahụ ma chọpụta ebe ọ bụla ị nwere ike ịchọ ọmụmụ ihe ọzọ. Ekwela ka nsogbu ọ bụla ị na-eche ihu mee ka ị daa mba; kama, lee ha anya dị ka ohere maka ịzụlite onwe gị na imeziwanye.

  1. The finance needed to set up a new business is called: A. working capital B. start-up capital C. retained profit D. expansion capital Answer: B
  2. Money used for the day-to-day running of a business is: A. start-up capital B. working capital C. share capital D. fixed capital Answer: B
  3. Which is usually a short-term finance need? A. building a new factory B. buying machinery for ten years C. paying this month's wages D. opening a new branch Answer: C
  4. Buying premises that will last many years should be financed by: A. a bank overdraft B. trade credit C. long-term finance D. petty cash Answer: C
  5. A profitable firm cannot pay its bills this month. It most needs: A. more profit B. short-term finance for working capital C. a new product D. less expansion Answer: B

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