Lesson 5.2.1

5.2.1 Sources of finance Quiz: OCR Business, Unit 5

20 questions

Written by Revision Ninja · Last reviewed 11 October 2026

In partnership with Revision Ninja

Lesson 5.2.1, Sources of finance: 20 multiple choice questions for the OCR Business (H431), Unit 5: Accounting and finance, written with Revision Ninja.

Host it live on the board and students join with a game code on their own devices, or revise alone with Free Play. The answers are revealed in the game.

Host this setFree Play

The 20 questions

  1. Which source of finance is generated entirely from within an existing business?

    • Share capital
    • Bank loan
    • Venture capital
    • Retained profit

  2. Which source of finance provides a short-term flexible buffer on a bank account?

    • Venture capital
    • Mortgage
    • Debenture
    • Bank overdraft

  3. Which accounting concept assumes that a business will continue trading for the foreseeable future?

    • Prudence
    • Materiality
    • Accruals
    • Going concern

  4. Which accounting concept requires expenses to be matched against the revenues they helped create?

    • Realisation
    • Accruals
    • Consistency
    • Objectivity

  5. Which source of finance involves selling an asset and renting it back immediately?

    • Venture capital
    • Trade credit
    • Debt factoring
    • Sale and leaseback

  6. Which accounting concept advises recording potential losses immediately but profits only when realised?

    • Going concern
    • Prudence
    • Consistency
    • Materiality

  7. Which source of external finance is unavailable to a private limited company?

    • Public share issue
    • Debenture
    • Venture capital
    • Bank loan

  8. What does GAAP stand for in financial accounting standards?

    • Generally Accepted Accounting Practice
    • Government Audited Accounting Procedures
    • General Asset Alignment Process
    • Global Annual Accounting Principles

  9. Which accounting concept states that financial statements must be based on solid factual evidence?

    • Accruals
    • Subjectivity
    • Objectivity
    • Prudence

  10. Which short-term external source of finance allows a firm to delay paying suppliers for goods?

    • Trade credit
    • Factoring
    • Leasing
    • Overdraft

  11. Which accounting concept requires a firm to apply the same accounting methods every year?

    • Consistency
    • Accruals
    • Realisation
    • Materiality

  12. What is the main legal requirement for published annual financial statements?

    • Guaranteed profit growth
    • Zero net debt
    • Maximum tax avoidance
    • True and fair view

  13. Which accounting concept permits ignoring minor items that do not affect user decisions?

    • Consistency
    • Prudence
    • Materiality
    • Objectivity

  14. Selling unpaid customer invoices to a specialist financial firm at a discount is called what?

    • Venture capital
    • Debt factoring
    • Trade credit
    • Sale and leaseback

  15. Which source of finance involves borrowing money secured specifically against land or buildings?

    • Debenture
    • Mortgage
    • Overdraft
    • Trade credit

  16. Which accounting concept dictates revenue is recognised only when goods or services are delivered?

    • Realisation
    • Prudence
    • Going concern
    • Accruals

  17. What long-term external loan option issuing fixed-interest certificates is available to public companies?

    • Trade credit
    • Commercial loan
    • Overdraft
    • Debenture

  18. A sole trader converting to a private limited company gains access to which new source of finance?

    • Bank overdraft
    • Trade credit
    • Equity capital
    • Retained profit

  19. Which external macroeconomic factor directly increases the borrowing cost of a variable-rate bank loan?

    • Inflation fall
    • Interest rate rise
    • Tax rate cut
    • Exchange rate rise

  20. If total revenue is £50,000 and total costs are £38,000, what is the profit?

    • £12,500
    • £22,000
    • £88,000
    • £12,000

All OCR Business quizzes