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B.E. Chapter 19 - Financing Your Business Flashcards | StudBud
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B.E. Chapter 19 - Financing Your Business
B.E. Chapter 19 - Financing Your Business
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B.E. - Chapter 19 - Financing Your Business
Flashcards
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Answers
1
What is not part of the financial road map for a business?
Balance Sheets
Credit rating
Income statements
Cash flow statements
2
Who is most likely to start a business within the next 10 years?
Jason
Harry
Kyla
Reenam
3
The main source of start-up money for an entrepreneur is
partners.
private investors.
personal resources.
local Banks.
4
A lender lends up to a specific amt. at a certain interest rate for a definite time period.
A capital loan.
A short term loan.
An equity loan
A line of credit
5
If the Small Bus. Admin. approves your request for a loan, it guarantees repayment of up to
a maximum of 90% of the loan.
a maximum of 50% of the loan.
a maximum of 75% of the loan.
a maximum of 80% of the loan.
6
The money used to support operations in the short term is called
short term capital.
personal capital.
operating capital.
debt capital.
7
When entering a partnership, always
shake hands after spitting in your palms.
have a witness to the verbal agreement.
put an agreement in writing & reviewed by an attorney.
do a background check on your partner.
8
Why is financial planning so important?
So you will know credit limits to put on your Credit Cards.
So, you will know how much equipment to buy.
It's not. Just get started.
Knowing what you will need before starting improves success.
9
When you operate as frugally as possible and cut all unnecessary expenses it is called
conservation.
shoestrapping
bootstrapping.
being cheap.
10
Cash raised for a business in exchange for an ownership stake in the business is called
risky.
capital
equity capital.
partnership.
11
An IPO is
an Initial Public Offering.
an Initial Possible Offering
an Investment Private Offering
an Individual Private Offering
12
What is "smart" money?
Investors who bring money, expertise & guidance to the bus.
Shroud business investors.
A CPA partner.
Banking partners.
13
One time expenses like equipment, furniture, and fixtures are called
business expenses.
capital expenditures.
start-up costs.
capital investments.
14
Which of the following is not one of the five 'Cs' Bankers use to grant a loan?
Collateral
Credit
Capacity
Character
15
Who provides funding to bus. owners who are at least 51% ethnic minority, female or disabled?
MSEBICs
MBSCIEs
MESBICs
MESCIBs
16
An agent who handles an entrepreneur's accounts receivable for a fee is called a
Purchasing Agent.
CPA
factor.
Accountant.
17
Short-Term financial needs are associated with
activities that are not part of normal operations.
the purchase of capital assets.
activities that are a part of normal operations.
the purchase of equipment and facilities.
18
An extra amount of money requested, saved and used only in an emergency is called
a contingency fund.
an emergency fund.
nest egg fund.
slush fund.
19
Once you have undertaken an IPO, your company is no longer
protected.
sophisticated.
public.
private.
20
An investigation and analysis a prudent investor does before investing is called a
Business Plan analysis.
due diligence.
credit report
due allegiance.
21
Source of equity financing with exceptional growth potential & experienced senior management is
an angel.
a venture capitalist.
a family friend.
a credit union.
22
What is usually the greatest single expense of a business?
Equipment.
Employees.
Spouse.
Facilites
23
When a business does borrow money, entrepreneurs should contribute
no more than 25% of the start-up capital.
at least 75% of the start-up capital.
more than half of the start-up capital.
less than half of the start-up capital.
24
Businesses grant -- -- to other businesses for purchase of goods or services.
Equity loans
Business credit
Credit lines
Trade credit
25
There were two types of skill sets suggested that should be aquired early up in a new business
they were an Accountant & an Attorney.
they were a CEO & a COO.
they were an Accountant & a Supply Chain Manager.
they were a H.R. Manager & an Accountant.
26
Which of the following would not be estimated in your start-up costs?
Insurance Costs
Capital Expenditures
Working Capital
Contingency Funds
27
In order for a Bank to make a loan it will examine a company's
credit rating.
equity.
cash flow.
accounts receivable.
28
An example of a capital expenditure would be
equipment.
insurance.
property taxes.
utilities.
29
Normal Venture Capitalists want at least
5 times return on their investment in about 4 to 8 years.
10 times return on their investment in about 5 to 7 years.
15 times return on their investment in about 5 to 7 years.
2 times return on their investment in 3 to 5 years.
30
Operating costs are often referred to as
start-up costs.
capital expenses.
liabilities.
working capital.
31
A type of security that signifies ownership in a corporation is called
stock.
deed.
collateral.
capital.
32
A nonprofessional private investor who funds start-up companies is called
savior.
a risk taker.
partner.
an angel.
33
Security in the form of assets that a company pledges to a lender is called
equipment
collateral
capital
credit
34
Money raised by taking out loans is called
debt capital.
equity capital.
credit capital.
non-cash capital.
