Topic study hub

Sources of finance

Study how businesses raise finance and judge suitable sources for different situations.

Objectives

Flashcards

Questions

54 min

Study time

AqaGcseBusinessFinance

Choose a revision tool

Start revising Sources of finance

Quick active recall practice

Quick multiple-choice practice

Mixed practice and exam-style prompts

Structured topic notes

Timed score-based practice

Full topic guide

Syllabus checklist

3 objective pages available

Finance sources and suitability3 objectives

Explain internal and external sources of finance, including family and friends, retained profit, share issue, loans or mortgages, selling assets, overdrafts, trade credit, hire purchase and government grants.
Analyse advantages and disadvantages of finance methods for a given situation.
Evaluate suitable sources of finance for new and established businesses.

Retained profitLiabilitySources of finance

Answering finance source questions: Start by naming the finance type, state whether it is internal or external, explain why it is suitable for the business context, and finish with a brief example.
Structure your answer clearly: Begin with a concise statement of the finance method, then list its advantages, followed by disadvantages, and finish with a contextual recommendation.

Confusing retained profit with retained earnings: Retained profit is the profit kept in a single accounting period, whereas retained earnings is the cumulative total of all retained profits over time.
Assuming all loans have the same interest rate: Interest rates vary by lender, credit rating and terms; compare rates and consider the cost of capital.

Choose a learning objective

Objectives are grouped by subtopic so students can jump straight to the exact skill they want to revise.