LESSON OBJECTIVE
Assessment Criteria AC 1.3 Evaluate appropriate sources of finance for a business project Below are questions pertaining to lesson 3. Please ensure to answer each question correctly. Berry Ltd. is considering how to finance the acquisition of a machine costing $750,000 with an operating life of five years. There are two financing options. Option 1: The machine could be leased for an annual lease payment of $679,985 or $56,665 monthly. Option 2: The machine could be bought using a loan from the bank paying a total of $778,525 or $64,877 monthly this includes processing fee from the bank.The life of the loan is seven years. 1. Recommend to Berry Ltd the most suitable source of finance for the purchase of the equipment. 2. Discuss the attractions of leasing as a source of short-term and long-term finance. 3. XYZ Ltd needs $100 million over the coming year to finance an expansion of the business.Cash flow from operations is expected to be $40m in the coming year. The remaining $60m can be financed from existing cash balance of $80m. Advise the firm if they should raise external finance to finance the proposed expansion or finance the difference from their existing cash balance. 4. True or false: Matching term of finance to the term of a project is important for businesses. Give reason for your answer
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LESSON OBJECTIVE
Assessment Criteria AC 1.2 Assess the implications of the different sources Below are questions pertaining to lesson 2. Please ensure to answer each question correctly. 1. Identify the advantages of a firm using long - term loan to finance the purchase of a fixed assets instead of using:- - Retained earnings - Debentures - Share issue 2. Jay has been operating his company for the last ten years, however, the company is unable to meet its obligations to its long and short term creditors on a timely basis. Recommend to Jay if he should file for bankruptcy or take a loan from a financial institution. 3. Assess the legal, financial,control and bankruptcy implications of the following sources of finance: - Long Term Bank Loan - Hire Purchase - Leasing 4. What is share dilution? LESSON OBJECTIVE
Assessment Criteria AC 1.1 Identify the sources of finance available to a business Below are questions pertaining to lesson 1. Please ensure to answer each question correctly. 1. What are the advantages and disadvantages of hire purchase and long term loan? 2. What is the difference between Preference Share and Ordinary Share? 3. Differentiate between short and long term sources of finance. 4. What are the advantages and disadvantages of a firm using retained earnings as a source of finance? This is a scholarly, higher education and professional forum for Intelligent Conversations. Only Questions, Posts and Scholarly Information related to Unit 2 are allowed.
Unit 2 Dialogue Group is a great medium for us to share individual analysis on how important financial information is recorded and how to use this information to make decisions for example in planning and budgeting. I will be uploading videos and/or review notes for each week's lesson. You will answer ALL the Review Questions posted weekly for each lesson. There will be Thirteen (13) Posts in total over the next 12 Weeks. To Earn The 10% Grade from this forum, you MUST answer the review questions by Sunday of each week. You will be penalized for Late Posts. You cannot cut and paste information on my board. These will be deleted promptly and you will be immediately given an 'F' Grade. It is not necessary to cite your own ideas provided, but it is advisable at this level to validate your work through referencing. Plagiarism is a crime punishable by expulsion. I will be using a register to record your excellent and anticipated participation in Unit 2 Dialogue. At the end of the semester, if you answer all weeks and on time you will earn an A Grade - Full Marks. If you miss more 4 or more posts or make 4 late posts, you earn an 'F' Grade. Your commitment and participation in your learning at Colbourne College speaks to your character and ability to meet professional requirements and developments. You will post twice per week. This will be to answer the Review Question or Pose a Question to your peers or the dialogue group moderation. Students can have good cross-discussions among themselves to stimulate critical thinking and build quality conversations. Be Engaged! Be Informed! REMEMBER! If you do not PASS Unit 2 Forum by consistent, robust and sustained dialogue, you WILL fail the entire Unit 2 Course. My only objective is to help you pass UNIT 2. This means posting relevant review questions from each lesson and getting you engaged in the course content. I review all posts that you make. I plan on making your learning and experiences in Unit 2 Dialogue Group focused, diverse, fun, engaging and interactive. By starting this unit and with expectation to Pass the course, you hereby accept this challenge. If you accept, you may begin. ABOUT BTEC L5 CURRICULUM FOR UNIT 2 MANAGING FINANCIAL RESOURCES AND DECISIONS UNIT OVERVIEW This unit is designed to give learners a broad understanding of the sources and availability of finance for a business organisation. Learners will learn how to evaluate these different sources and compare how they are used. LEARNING OUTCOMES On successful completion of this unit you will: 1 Understand the sources of finance available to a business 2 Understand the implications of finance as a resource within a business 3 Be able to make financial decisions based on financial information 4 Be able to evaluate the financial performance of a business. |
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November 2016
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