Items Estimated cost (vnd) My justification for this estimate

Coffee machine 51,519,000 x 2 =

103,038,000
http://www.lazada.vn/jura-impressa-f7-piano-black-
may-pha-ca-phe-116760.html
Tables and Chairs 900,000 x 10 =
9,000,000
http://www.vatgia.com/6872/3126668/b%E1%BB%99-
b%C3%A0n-gh%E1%BA%BF-g%E1%BB%97-cafe-
tn900.html
Cups 150,000 x 50 =
7,500,000
http://www.lazada.vn/luminarc-h6739-bo-6-ly-
conique-thuy-tinh-116523.html
Cash Register 36,300,000 x 1 =
36,300,000
http://maytinhtienchinhhang.com/May-tinh-tien/May-
tinh-tien-Casio/May-tinh-tien-Casio-QT6600.aspx#.U-
ize7353Tc
Counter 6,950,000 x 1 =
6,950,000
http://decoviet.vn/quay-bar-cafe-gia-re/
Sink 2,780,000 x 3 =
8,340,000
http://thietbivesinhviet.com/45590/chau-rua-de-ban-
inax-l-300v/
Toilet 2,948,000 x 3 =
8,844,000
http://thietbivesinhviet.com/63179/bet-2-khoi-caesar-
cd1330-chau-l2150/
Coffee bean 160,000(500gr) x 10 =
1,600,000

http://www.vatgia.com/863/1371313/c%C3%A0-
ph%C3%AA-trung-nguy%C3%AAn-ch%E1%BA%BF-
phin-5-500g-g%C3%B3i-2101609.html

Stationery 1,870 x 10 = 18,700 http://flexoffice.com.vn/but-bi-flexoffice-fo-03-mau-
xanh-1985-04.htm#.U-i8wL353Tc




Sources of finance
There are 2 types of sources of finance:
- Internal sources (raised from within the organisation)
- External sources (raised from an outside source)
There are 5 Internal sources of finance:
Owners investment
Advantages
Doesnt have to be repaid
No interest is payable
Disadvantages
There is a limit to the amount an owner can invest

Retained Profits
Advantages
Doesnt have to be repaid
No interest is payable
Disadvantages
Not available to a new business
Business may not make enough profit to plough back

Sale of Stock
Advantages
Quick way of raising finance
By selling off stock it reduces the costs associated with holding them
Disadvantages
Business will have to take a reduced price for the stock

Sale of Fixed Assets
Advantages
Good way to raise finance from an asset that is no longer needed
Disadvantages
Some businesses are unlikely to have surplus assets to sell
Can be a slow method of raising finance

Debt Collection
Advantages
No additional cost in getting this finance, it is part of the businesses normal
operations
Disadvantages
There is a risk that debts owed can go bad and not be repaid

There are 8 External sources of finance:
Bank Loan
Advantages
Set repayments are spread over a period of time which is good for
budgeting
Disadvantages
Can be expensive due to interest payments
Bank may require security on the loan
Bank Overdraft
Advantages
This is a good way to cover the period between money going out of and
coming into a business
If used in the short-term it is usually cheaper than a bank loan
Disadvantages
Interest is repayable on the amount overdrawn
Can be expensive if used over a longer period of time

Additional Partners
Advantages
Doesnt have to be repaid
No interest is payable
Disadvantages
Diluting control of the partnership
Profits will be split more ways

Share Issue
Advantages
Doesnt have to be repaid
No interest is payable
Disadvantages
Profits will be paid out as dividends to more shareholders
Ownership of the company could change hands

Leasing
Advantages
Businesses can have the use of up to date equipment immediately
Payments are spread over a period of time which is good for budgeting
Disadvantages
Can be expensive
The asset belongs to the finance company

Hire Purchase
Advantages
Businesses can have the use of up to date equipment immediately
Payments are spread over a period of time which is good for budgeting
Once all repayments are made the business will own the asset
Disadvantages
This is an expensive method compared to buying with cash

Mortgage
Advantages
Business has the use of the property
Payments are spread over a period of time which is good for budgeting
Once all repayments are made the business will own the asset
Disadvantages
This is an expensive method compared to buying with cash
If business does not keep up with repayments the property could be
repossessed

Trade Credit
Advantages
Business can sell the goods first and pay for them later
Good for cash flow
No interest charged if money is paid within agreed time
Disadvantages
Discount given for cash payment would be lost
Businesses need to carefully manage their cash flow to ensure they will
have money available when the debt is due to be paid

Government Grants
Advantages
Dont have to be repaid
Disadvantages
Certain conditions may apply e.g. location
Not all businesses may be eligible for a grant