Types & sources of business finance

Explain one benefit to Tom Pellereau of using a business angel as a source of finance.

Using the data in Extract B, calculate the acid test ratio for Stylideas Ltd in 2024 to 2 decimal places. You are advised to show your working.

Assess whether Stylideas Ltd’s distinctive capability of innovation is the main reason for its success.

Assess the likely effects on Stylideas Ltd of changes in the UK business cycle.

As Stylideas Ltd grows, Tom Pellereau is considering whether to change its current role culture to a power culture to maintain the business’ success.

Evaluate these two options and recommend which one Tom Pellereau should choose to maintain the business’ success.

Explain one benefit to Vidsy of having a mission statement.

Using the data in Extract B, calculate Vidsy’s return on capital employed (ROCE) for 2021. State your answer to two decimal places. You are advised to show your working.

Assess whether Vidsy’s directors should focus purely on shareholder returns in the company’s business decisions.

Assess whether offering financial rewards is the best way for Vidsy to reduce its labour turnover.

Vidsy’s directors wish to expand into the US market. To achieve this, the directors are considering whether to finance this expansion either by using retained profit or external finance.

Evaluate these two options and recommend which one Vidsy’s directors should choose to finance the company’s expansion into the US market.

Explain one likely reason why Pura Cosmetics chooses to use batch production.

Using Extract B, calculate the contribution per unit of one lip balm. You are advised to show your working.

Assess the value of venture capital as an external method of finance for Pura Cosmetics.

Assess the extent to which Unilever may benefit from its takeover of Dermalogica.

Pura Cosmetics has set the objective of managing its cash-flow more effectively. To achieve this, it is considering two options; either to increase its overdraft facility or to reduce the credit period given to its retail customers.

Evaluate these two options and recommend which one Pura Cosmetics should choose in order to achieve the objective of managing its cash-flow more effectively.

Assess two suitable external methods of finance that could have been used by Andy and Holly for The Wonky Table start-up capital in 2010.

Holly and Andy are considering creating a mission statement for The Wonky Table.

Assess the potential benefits to The Wonky Table of having a mission statement.

Assess the likely value of flexible working to small family-owned restaurants, such as The Wonky Table.

Holly and Andy are considering ways to increase profits. They could either extend their premises upstairs or offer external catering to local businesses.

Using the data in Extract G and SWOT analysis, evaluate each option and recommend to Holly and Andy which one might be better for them to increase profits.

Assess two ways Derby Theatre could improve its liquidity.

Assess the likely value of succession planning to Derby Theatre.

Assess the likely value to Derby Theatre of producing and staging shows that recognise the cultural diversity of Derby’s population.

Pre-theatre dining has been unpopular at Derby Theatre. Catering Consultant Andrew Dean has argued that a refurbishment of its cafe and kitchens is required.

In order to finance the £100 000 catering investment, Derby Theatre management is considering using either some of its £120 000 retained profit or a loan.

Evaluate these two methods of finance and recommend which one might be most appropriate to finance the £100 000 catering investment at Derby Theatre.

Explain one reason why businesses that sell VisionSpring’s glasses may prefer to stay small.

For people in developing countries, purchasing a pair of VisionSpring glasses may be considered as an investment.

Using the data in Extract B, calculate the average rate of return from purchasing a pair of glasses. You are advised to show your working.

Assess VisionSpring’s decision to finance its growth using retained profits.

Assess whether the decision to be a socially responsible business is likely to increase Warby Parker’s profits.

Warby Parker’s main corporate objective is to grow the business. The management is considering two options, either to develop a new range of contact lenses for the high income market, or to start selling glasses in the low income market.

Evaluate these two options and recommend which one is most likely to achieve Warby Parker’s main corporate objective.

Explain one reason Mumtaz has always used internal finance to establish and expand its business.

Using the data in Extract B, calculate the margin of safety. You are advised to show your working.

Assess whether expanding by organic growth was the right decision for Mumtaz.

Using the data in Extract C, assess the likely impact of the forecast changes in the UK economy on a business such as Mumtaz.

Mumtaz’s aim is to become the UK’s market leader in Asian ready meals. To achieve this, it could produce own label ready meals for supermarkets or focus on selling more Mumtaz premium brand name products.

Evaluate these two options and recommend which is most suitable for Mumtaz to achieve its aim.

Explain one internal cause of the business failure of MG Rover Group.

Using the data in Extract F, calculate the monthly labour cost per car. You are advised to show your working.

Assess the likely effects of employee legislation on a business such as VW.

Corporate timescales can be short-term or long-term.

Assess Toyota’s decision to issue ‘Model AA’ shares as a means of raising finance.

VW’s new Chief Executive has been given the aim of increasing the company’s profitability. The two options VW is considering are to develop a new range of self-driving cars or to improve productivity.

Evaluate these two options and recommend which is most suitable to achieve the aim of increasing profitability, for a business such as VW.

Innocent Drinks has constructed the network diagram below to plan the launch of a new line of smoothies. Each number represents how many days each activity is

Using the data in the network diagram above, calculate the Earliest Start Times (EST) and Latest Finishing Times (LFT) for each activity and identify the critical path.

Using the data in Extract F, explain one implication of the level of capacity utilisation for the soft drinks manufacturer A, compared to B. You are advised to show your working.

Assess whether Innocent Drinks Ltd should have raised finance by selling a minority of its shares to a business, such as Coca-Cola.

Assess the likely effects for AG Barr of taking over Funkin, the cocktail mixer business.

Unilever’s Chief Executive believes that Unilever should aim to consider all of its stakeholders in its main business decisions. Some business analysts consider that Unilever should instead consider an aim of focusing purely on its shareholders.

Evaluate these two aims and recommend which is most suitable for a business, such as Unilever.