Your laptop has broken. List all the ways you could obtain the money to buy a new one.

1

• Your laptop has broken. List all the ways you
  could obtain the money to buy a new one.
• (5mins)

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LESSON TITLE Sources of Finance (LO2.2) CF Key
Skills (L5) you will be able to use your numeracy
skills to calculate financial transactions of a
business and to interpret financial data.
LEARNING OBJECTIVES LO1) To explain the
internal sources of finance available to a
business. LO2) To explain the external sources
of finance (l-term/s- term) available to a
business.
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STARTER Scenario (10mins) TASKS Internal
external sources of finance Mini-case study
Complete LO2.2 PLENARY Biz
Quiz (10mins)
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LO1 Sources of Finance
EXTERNAL
INTERNAL
S-TERM
L-TERM
Profit
Working Capital
SHARE CAPITAL
LOAN CAPITAL
Overdraft
Sale of assets
Bank Loan
Hire Purchase
Mortgage
Trade Credit
Debentures
Leasing
Government
Industrial Specialists
Debt Factoring
Credit Cards
Business Angels
5
LO2 Sources of Finance
EXTERNAL
INTERNAL
S-TERM
L-TERM
Profit
Working Capital
SHARE CAPITAL
LOAN CAPITAL
Overdraft
Sale of assets
Bank Loan
Hire Purchase
Mortgage
Trade Credit
Debentures
Leasing
Government
Industrial Specialists
Debt Factoring
Credit Cards
Business Angels
6
LO2 Sources of Finance

• Debt Factoring

2) Pays invoice in full (minus commission)
3)Pays debt factoring company
1) Sells product to customer and sends invoice
(30-90days credit)
CUSTOMER
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LO2 Sources of Finance
INTERNAL
EXTERNAL
S-TERM
L-TERM
Profit
Working Capital
SHARE CAPITAL
LOAN CAPITAL
Overdraft
Sale of assets
Bank Loan
Hire Purchase
Mortgage
Trade Credit
Debentures
Leasing
Government
Industrial Specialists
Debt Factoring
Credit Cards
Business Angels
8
LO2 Sources of Finance

• Debentures
• - Loan with no voting rights
• - Fixed repayment date
• - Fixed interest rate

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LO2 Sources of Finance
EXTERNAL
INTERNAL
S-TERM
L-TERM
Profit
Working Capital
Overdraft
SHARE CAPITAL
LOAN CAPITAL
Sale of assets
Bank Loan
Hire Purchase
Mortgage
Trade Credit
Debentures
Leasing
Government
Industrial Specialists
Debt Factoring
Credit Cards
Business Angels
10
LO2 Sources of Finance

• Industrial Specialists-
• - Such as Venture Capitalists
• - Loans for businesses that find it difficult to
  raise funds using banks because they are seen as
  too risky.
• Business Angels-
• - Individuals who invest between 10,000
• and 100,000.
• - Often in exchange for a stake in the business.

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Key Terms
S-term Profit (net) Working Capital Share Capital
Mortgage Debentures Venture Capitalists Business Angels
Hire Purchase Leasing Trade Credit Debt Factoring
Industrial Specialists
12
LESSON TITLE Sources of Finance (LO2.2) CF Key
Skills (L5) you will be able to use your numeracy
skills to calculate financial transactions of a
business and to interpret financial data.
LEARNING OBJECTIVES LO1) To explain the
internal sources of finance available to a
business. LO2) To explain the external sources
of finance (l-term/s- term) available to a
business.