Identify and evaluate costs involved in the purchase of business assets.

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AS and A Level Business Studies

Umar Hussain

AO5

Identify and evaluate costs involved in the purchase of business assets.

Sue has spent a lot of money on assets in total she has spent a lump sum of £14318 She has spent this sum on:

  1. Building costs £6500. She needs this in order to store and produce her pots  
  2. Kiln cost £3500. This is needed in order to produce her pottery.
  3. Van £2000. The van is needed so she can make deliveries also pick up her materials.
  4. Pottery wheel £1118. She also needs this to make the pots.
  5. Equipment £1200. The equipment is also needed to make pots.

Opportunity cost

If sue did not use the money for these assets she could have used the £14318. And invested the money into a savings account. I have looked up the nationwide savings illustrator and found out  

Based on your information:

Join now!

 

  

17/05/07

I have gone onto the nationwide building society website and found out researched that if she had invested £10000 in a bonus saver account at an interest gross rate of 5.15% she would see a return of £844.83 return back every 2 years.

Leasing

When structured as an operating lease this is a form of financing that avoids the down payment usually required for the purchase of equipment. Because leased equipment is not owned by the company sometimes it does not appear on the balance sheet.

The advantages of leasing for the ...

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Identify and evaluate costs involved in the purchase of business assets.
Document Details
  • Word Count
    1764
  • Page Count
    6
  • Level
    AS and A Level
  • Subject
    Business Studies
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