Business 7115 · O Level · Business finance: needs and sources
Business finance: needs and sources — practice question
BGR is a private limited company running 6 cinemas in different towns. Clear internal communication matters to BGR. The Finance Director has been studying BGR’s accounts, and an extract is included in Table 4.1. BGR intends to open another cinema and will need to hire 10 new employees. The new cinema will cost $8m. The Finance Director must decide whether BGR should issue new shares or take out a bank loan to finance the expansion.
(a)[2]
Define the term ‘cost of sales’.
(b)[2]
Calculate $X$ and $Y$ from the information below.
$X$:
$Y$:
(c)[4]
Identify four stages in the recruitment process used by the business.
Stage 1:
Stage 2:
Stage 3:
Stage 4:
(d)[6]
Explain two reasons why effective communication may be important to BGR.
Reason 1:
Explanation:
Reason 2:
Explanation:
(e)[6]
Do you think issuing new shares is a better method for a limited company to fund expansion than using a bank loan? Justify your answer.
Worked solution & mark scheme
This 20-mark question has a full step-by-step worked solution and mark scheme. One marking point: “The expense of producing or purchasing the goods sold during a period” …