2. Tutorial:Business Academy Topic: Business financing Prepared by:Ing. Marcela Zlatníková Projekt Anglicky v odborných předmětech, CZ.1.07/1.3.09/04.0002 je spolufinancován Evropským sociálním fondem a státním rozpočtem České republiky.

3. Business financing is acquisition and spending of financial resources. It takes place at: a/ setting up a business b/ ordinary course of a business c/ expansion of a business and its activities d/ dissolution of a business

4. Depending on who it belongs to: - Personal - Other Depending on how long they are available in the business: - Long-term - Short-term Depending on where they come from: - Internal - External As shown in the company‘s balance sheet: - Balance - Non-balance

5.  It consists in getting money from investors and its spending on equipment of the business by means of long-term and circulating property  Long-term and circulating prope r ty should be financed from long-term funds, especially from basic capital  Basic capital is formed by financial and material contributions of proprietors (partners, shareholders, members).  Part of the property may be financed from other funds, such as bank loan  In this case, bank examines the business plan of the company and will require financial security of the loan by the company‘s property

6.  In the ordinary course of business circulating material performs cycle. Fixed assets and human labour are also involved in this cycle. It is connecetd to circulation of money too.  Financing ordinary course of business rests in getting money from sales or short-term loans and its spending on the purchase of material and services, recovery investments, payment of wages, payment of taxes, payment of interests, repayment of loans, payment of dividends  If the company reaches profit, it gets more money on ordinary activity than it must spend

7. The company may be expanded by: - Actual developing investments (in long-term property, increase of stock) - Financial assets (buying stocks and shares of other companies) It is long-term assets which should be financed from long-term funds. These funds may include: - Non-split profit from previous years - Other proprietors‘ contributions - Bond issue - Long-term bank loans

8.  Businesses as legal persons are usually cancel l ed by voluntary decision of the competent authority of the company, or by court  It is cancelled either with or without liquidation  Liquidation is the process of liquidation of the business estate. Special financial statement is elaborated, liquidator is appointed and he or she gradually sells business property, pays its obligations and looks into liquidation balance.  Financing business when liquidating means getting money by selling business property, its use to cover its liabilities and payment of shares on liquidation balance

9. The company can provide its long-term solvency: - If long-term assets are financed from long-term sources - If it makes profit - If it observes a certain ratio between own and foreign capital, that means it will not exceed certain level of indebtedness It also depends on these variables how quickly the company can expand so that it does not endanger its solvency

10. 1/ State which sources of the company cannot be used to finance business 2/ Describe the course of issue, sale and paying of bonds 3/ Describe the statutory authorities of different types of companies 4/Name some short-term sources of the company

11.  Biňovec, K. Přehled učiva k maturitní zkoušce z ekonomiky. Fortuna, 2004. ISBN 80- 7168-747-2.  Švarcová Jena, ing a kolektiv, Ekonomie, stručný přehled. Ing. Jena Švarcová, Ph.D., CEED nakladatelství a vydavatelství, 2006. ISBN 80-903433-3-3.  Klínský Petr, Munch Otto, Ekonomika pro obchodní akademie a ostatní střední školy 1- 4. Fortuna, 2003, ISBN 80-7168-862-2.