sources of finance Flashcards
1
Q
What are 2 short term sources of finance and their advantages
A
- trade credit: useful for firm to earn money needed to pay debt flexibility or else large fee if not made
- overdrafts: make money in time without delay, high interest and might have to sell assets. flexibility
2
Q
what are 2 long term sources of finance
A
- Loans: easy and quick but interest and repossess assets, mortgages property can be withdrawn and interest rates
Hire purchase: longer period of time and can buy if cannot afford
3
Q
what is the condition for government grants
A
- strict criteria
4
Q
what can established firms do
A
- retained profits
- fixed asset sale: limit as you cannot go onto trading
- new share rule less control and more dividends
5
Q
what are internal soruces
A
- personal savings
- retained profits
- selling assets
