Exam 7: How to Obtain the Right Financing for Your Business

_____ project working capital needs by estimating what out-of-pocket expenses will be incurred and when revenues from these sales are to be collected.

_____ consists of two or more companies exchanging items of roughly equal value.

Common stock is issued with a fixed par value.

What are some of the specialized programs run by the Small Business Administration to help small businesses?

The role of equity financing is to serve as a buffer that protects creditors from loss in case of financial difficulty.

Small business investment companies are:

People who start a small business usually seek outside funding before using their own funds.

Preferred stockholders give up their right to receive profits in exchange for the right to vote for the corporation's directors.

Small businesses' assets, such as buildings, should be financed with long-term loans.

Describe the guaranteed loans provided by the Small Business Administration to small business owners.

In the context of small businesses, which of the following is true of asset-based financing?

Debt financing comes from lenders who will be repaid at a specified interest rate within an agreed-on time span.

Many "unsecured" loans that banks extend to small businesses require personal guarantees by the managers of the firm.

Venture capital firms generally require a substantial return as either equity or profit.

When sales are made on credit, the firm must carry the costs of production itself for an extended period.

In the context of small businesses, what is bartering?

In the context of small businesses, which of the following is true of consignment selling?

Growing companies are best financed entirely with debt financing.

Long-term debt secured by real estate property is a mortgage loan.

A lease is a contract that permits use of someone else's property for a specified period of time.