sources of finance
Some sources of finance are short term and must be paid back within a year. Other sources of finance are long term and can be paid back over many years. Internal sources of finance are funds found inside the business. For example, profits can be kept back to finance expansion. Alternatively the business can sell assets(items it owns) that are no longer really needed to free up cash. External sources of finance are found outside the business, eg from creditors or banks.
The source of finance chosen will depend on a number of factors:
INTERNAL SOURCES OF FINANCE
The source of finance chosen will depend on a number of factors:
- Purpose - what the finance is to be used for
- Time period - how long the finance will be needed for
- Amount - how much money the business needs
- Ownership and size of the business
INTERNAL SOURCES OF FINANCE
EXTERNAL SOURCES OF FINANCE