Business 7115 · O Level · Cash-flow forecasting and working capital
Cash-flow forecasting and working capital — practice question
Bakin Group (BG) is a limited company. It runs 3 holiday parks that provide family holiday accommodation and activities. BG wants to look after customers’ needs 24 hours a day. Customers pay when they arrive at the park for their holidays. Each park employs 3 managers and 40 part-time employees. BG uses a wide mix of social media networks for promotion. The Finance Director is concerned about BG’s cash flow position. He cannot decide whether an overdraft is the best option for BG to solve its cash flow problem.
(a)[2]
What does the term ‘limited company’ mean?
(b)[2]
Calculate X and Y.
(c)[4]
Identify and explain two advantages to BG of employing part-time staff.
(d)[6]
Identify and explain one advantage and one disadvantage for BG in using social media networks for promotion.
(e)[6]
Do you think an overdraft is the best way for BG to solve its cash flow problem? Give reasons for your answer.
Worked solution & mark scheme
This 20-mark question has a full step-by-step worked solution and mark scheme. One marking point: “A business that has a legal identity separate from its owners” …