Business

3.1.0 Source of finance ? Firms need _____Capital___ to present wages, to buy rough materials, to endure for promotional activities, to fund research and development, to enable them to institutionalize in new machinery and equipment and to enable firms to grow. ? Different ___________________________ these activities atomic number 18 needed. o well-nigh bequeath be ___internal___________ (from within the company itself) o few can be ____external__________ (outside the firm) 3.1.1 Forms of finance ? External finance (financing from outside the company): o ________loan capital_______: Any loan capital borrowed from a swan is down to ___interest payment _____________ on a unfaltering (usually monthly) basis. Repayments must as well be maintained as agreed by the bank and the firm. Loans can either be _______________________. ? mind of bank loans ? a ll told firms can use this parentage of finance. ? Smaller firms, which are perceived to be higher risk, allow for normally be charged higher interest rates. ? Lenders are unlikely to grant unlatched loans to firms that are small and/or higher risk.

o ____________: is a long-term liability, which companies can snub (this source of finance is non available for unincorporated businesses). It may, or may not, be secured on the value of any business assets. The debentures pay the holder a _________________ annually and the debentures are ___________ - the company will repay the touchstone of each certificate a t the repurchase date (which is prepare on ! the certificate). The debentures can be traded as if they were shares. Debentures, unlike shares, acquit no voting rights at the AGM. ? Assessment of debentures ? This source of finance is only available to ____________ businesses. ? Interest payments are _______ and, therefore, may point a burden on the firms ______________....If you necessitate to get a full essay, order it on our website: OrderEssay.net

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