IGCSE/GCSE/O & A Level/IB/University Student Forum

Qualification => Subject Doubts => IGCSE/ GCSE => Commerce => Topic started by: joel on May 17, 2009, 03:01:24 pm

Title: BUsiness Studies
Post by: joel on May 17, 2009, 03:01:24 pm

Why is Profit Important to a Business?

Title: Re: BUsiness Studies
Post by: angell on May 17, 2009, 03:03:22 pm

Its a return to the owners or risk takers of the business. It can be used for reinvestment, it can be used to pay dividends to share holders, it helps aid any expansion plans of the business.It is a motivation to work harder and more efficiently.

Title: Re: BUsiness Studies
Post by: joel on May 17, 2009, 03:07:16 pm

Ok Thanks

Title: Re: BUsiness Studies
Post by: angell on May 17, 2009, 03:10:38 pm

:) my pleasure:P!

Title: Re: BUsiness Studies
Post by: Enia on May 17, 2009, 03:19:20 pm

oh I also have a question:
what documents would the bank manager ask to see before issuing a loan to a business and why would he want to see these? 

Thank you

Title: Re: BUsiness Studies
Post by: angell on May 17, 2009, 03:33:38 pm

A cash flow forecast - to see how big a loan or overdraft is needed,  when it is needed, whether it can b repaid or not and the period of time the finance is needed for.

a trading and profit and loss acount to measure the profitability of the business,

A balance sheet which will show the financial position of the business at a given date - and also the value of its creditors(and get  a look at its risk and gearing ratio)

Title: Re: BUsiness Studies
Post by: angell on May 17, 2009, 03:35:48 pm

ah...is there something im missing in the previous question, guys?

Title: Re: BUsiness Studies
Post by: Enia on May 17, 2009, 03:38:47 pm

Thank you! Its really appreciated :D

Title: Re: BUsiness Studies
Post by: angell on May 17, 2009, 03:39:52 pm

:P just dont forget to +rep hahaha...:)

Title: Re: BUsiness Studies
Post by: Enia on May 17, 2009, 03:41:53 pm

lol okee. But you have to wait a while since they say I can't do it more than once in two hours. xD *did it already in another thread thts why* xD