Unit 3: Finance and Accounts
Topic 3.1: Introduction to Finance Questions
Practice 20 exam-style questions for IB Business Management Topic 3.1. Review the question stems below, then unlock the full Question Bank to access markschemes, model answers, and AI grading.
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State two reasons why businesses need finance.
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Define the term capital expenditure.
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Define the term revenue expenditure.
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State one example of capital expenditure and one example of revenue expenditure.
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State two reasons why businesses need finance.
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Define the term capital expenditure.
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Define the term revenue expenditure.
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State one example of capital expenditure and one example of revenue expenditure.
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Unlock Question11explain4 marks
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A business installs a new IT system that will be used for five years. Identify the type of expenditure and explain why.
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Identify one stakeholder group that uses financial information and explain what they use it for.
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Outline one possible effect on a business if it wrongly records capital expenditure as revenue expenditure.
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A business buys new machinery and also pays for routine servicing of the machinery. Classify each cost.
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Outline one possible effect on a business if it wrongly records capital expenditure as revenue expenditure.
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A business buys new machinery and also pays for routine servicing of the machinery. Classify each cost.
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Explain the difference between start-up finance and working capital.
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A firm repaints its office to keep it looking professional. Identify the type of expenditure and justify your answer.
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Outline two purposes of finance for a growing business.
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A business installs a new IT system that will be used for five years. Identify the type of expenditure and explain why.
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