Business Studies Multiple Choice Question – 26 February 2018

The home of multiple choice questions for all your KS3, KS4 and KS5 Business Studies, Economics and Accounting requirements.

Which ONE of the following is an advantage of using a bank loan to finance a business?

Choose ONE answer only:

  1. Less flexible than overdrafts
  2. Regular interest payments are incurred
  3. Collateral is often required to offer as security for the loan
  4. Relatively straightforward to arrange
  5. Can be recalled before the agreed date

Explain one advantage to a business of using a bank loan to finance a business?

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This is multiple choice question is suitable for Business Studies KS4 classes.

The answer is 4 – As long as a business can produce evidence that the loan is likely to be repaid within the time agreed, they are relatively straightforward to arrange. In addition, unlike overdrafts, they cannot be recalled before the agreed date. The other three options are all disadvantages of bank loans.

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Business Studies Multiple Choice Question – 25 February 2018

The home of multiple choice questions for all your KS3, KS4 and KS5 Business Studies, Economics and Accounting requirements.

Which ONE of the following is an advantage of using a bank loan to finance a business?

Choose ONE answer only:

  1. Less flexible than overdrafts
  2. Regular interest payments are incurred
  3. Collateral is often required to offer as security for the loan
  4. Relatively difficult to arrange
  5. Cannot be recalled before the agreed date

Explain one disadvantage to a business of using a bank loan to finance a business?

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This is multiple choice question is suitable for Business Studies KS4 classes.

The answer is 5 – As long as a business can produce evidence that the loan is likely to be repaid within the time agreed, they are relatively straightforward to arrange. In addition, unlike overdrafts, they cannot be recalled before the agreed date. The other three options are all disadvantages of bank loans.

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Business Studies Multiple Choice Question – 24 February 2018

The home of multiple choice questions for all your KS3, KS4 and KS5 Business Studies, Economics and Accounting requirements.

The table below shows the cash-flow forecast for a small business for one month:

Total Receipts £15,760
Raw Materials £6,030
Rent £1,200
Total Payments £7,230
Net Cash Flow £8,530
Opening Balance £4,070
Closing Balance ???

Which ONE of the following is the correct figure for the closing balance?

Select ONE answer only:

  1. (390)
  2. 5,370
  3. 7,230
  4. 8,310
  5. 12,600

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This is multiple choice question is suitable for Business Studies KS4 classes.

The answer is 2 – The closing balance is the amount of money remaining at the end of the month, and is calculated by subtracting the net cash flow (which is the difference between total receipts and total payments for the month) from the opening balance at the start of the month. (Remember, figures in brackets are minus figures). Therefore: £4,070 + £8,530 = £12,600

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Business Studies Multiple Choice Question – 23 February 2018

The home of multiple choice questions for all your KS3, KS4 and KS5 Business Studies, Economics and Accounting requirements.

The table below shows the cash-flow forecast for a small business for one month:

Total Receipts £5,760
Raw Materials £6,030
Rent £1,200
Total Payments £7,230
Net Cash Flow (£1,470)
Opening Balance £9,780
Closing Balance ???

Which ONE of the following is the correct figure for the closing balance?

Select ONE answer only:

  1. (390)
  2. 5,370
  3. 7,230
  4. 8,310
  5. 12,600

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This is multiple choice question is suitable for Business Studies KS4 classes.

The answer is 2 – The closing balance is the amount of money remaining at the end of the month, and is calculated by subtracting the net cash flow (which is the difference between total receipts and total payments for the month) from the opening balance at the start of the month. (Remember, figures in brackets are minus figures). Therefore: £9,780 – £1,470 = £8,310.

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This work is licensed under a Creative Commons Attribution 4.0 International License.

Business Studies Multiple Choice Question – 22 February 2018

The home of multiple choice questions for all your KS3, KS4 and KS5 Business Studies, Economics and Accounting requirements.

The table below shows the cash-flow forecast for a small business for one month:

Total Receipts £5,760
Raw Materials £6,030
Rent £1,200
Total Payments £7,230
Net Cash Flow (£1,470)
Opening Balance £6,840
Closing Balance ???

Which ONE of the following is the correct figure for the closing balance?

Select ONE answer only:

  1. (390)
  2. 5,370
  3. 7,230
  4. 8,310
  5. 12,600

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This is multiple choice question is suitable for Business Studies KS4 classes.

The answer is 2 – The closing balance is the amount of money remaining at the end of the month, and is calculated by subtracting the net cash flow (which is the difference between total receipts and total payments for the month) from the opening balance at the start of the month. (Remember, figures in brackets are minus figures). Therefore: £6,840 – £1,470 = £5,370.

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Business Studies Multiple Choice Question – 21 February 2018

The home of multiple choice questions for all your KS3, KS4 and KS5 Business Studies, Economics and Accounting requirements.

A business pays annual interest of £1812.50 on a bank loan of £155,500.

Which one of the following is the annual interest the business pays as a percentage of the amount borrowed?

Select ONE answer only:

  1. 5.17
  2. 4.17
  3. 3.17
  4. 2.17
  5. 1.17

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This is multiple choice question is suitable for Business Studies KS4 classes.

The answer is 5 – £1812.50 / £155,500 x 100 = 1.17% 

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Business Studies Multiple Choice Question – 20 February 2018

The home of multiple choice questions for all your KS3, KS4 and KS5 Business Studies, Economics and Accounting requirements.

A business pays annual interest of £812.50 on a bank loan of £15,500.

Which one of the following is the annual interest the business pays as a percentage of the amount borrowed?

Select ONE answer only:

  1. 0.052
  2. 0.52
  3. 5.2
  4. 52
  5. 520

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This is multiple choice question is suitable for Business Studies KS4 classes.

The answer is 3 – £812.50 / £15,500 x 100 = 5.2%

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This work is licensed under a Creative Commons Attribution 4.0 International License.