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Summary Sources of finance Defined
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It includes the multiple sources of finance (internal and external) and their definitions
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"Cost of Sales" "The costs to the business of goods sold.""Stocks" "Raw materials, work in progress and finished goods."
"Loss" "Where the total costs of a business exceeds its total revenue in a period."
"Net Profit" "The amount by which the total revenue a business exceeds its total costs
and expenses."
"Profit" "The difference between total sales and total costs of business."
"Gross Profit" "A measure of profit calculated as: revenue less cost of sales."
"Balance Sheet" "Shows the financial position (assets and liabilities) of a business at a
specific moment in time."
"Liquidity" "Measures of a businesses ability to pay its debt."
"Leaseback" "Sale and leaseback where a business sells fixed assets and then leases
them back."
"Profit & Loss" "Profit and loss describes the results of the trading (revenue and costs) of a
business in a period of time."
"Net Assets" "The difference between the total value of assets owned by a business and
the total of its liabilities."
"Turnover" "An alternative word for revenue or sales"
"Retained Profit " "Profits earned by a business that are reinvested in the business
rather than paid out as dividends."
"Revenue" "Another term for the value of sales made in a business."
"Costs""Amounts incurred by a business in producing and selling its products."
"Liabilities" "Debts owed by a business."
"Overdraft" "A loan facility from the bank that may have to be repaid at any time."
"Finance" "The money required to set up, run and expand a business."
"Fixed Assets " "Resources used and owned by a business over the long term such as
buildings and machinery."
"Overheads" "Cost incurred by a business that are not directly related to production
activities."
"Interest" "the cost of borrowing money or the return on saving."
"Creditors" "People, businesses or other organisations to which a business owes money."
"Loan" "Where money is borrowed and repaid under agreed terms and conditions."
"Flotation" "Where the shares of a company are offered for sale on a stock market for the
first time."
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