WHY BUSINESS NEEDS FINANCE
SOURCES OF FINANCE
some sources of finance are short term and must be paid back within a year
OWNERS
LOANS
DEBENTURES
Long term and can be paid back over many years
OVERDRAFT FACILITY
TRADE CREDITS
FACTORING
finance refers to soucers of money for a business, firms need finance to
START UP
a business, eg pay for premises,new equipment and advertising
RUN
the business,eg having enough cash to pay staff wages and suppliers on time
EXPAND
the business,eg having funds to pay for a new branch in a different city or country
existing the
CREDITOR
is and individual or busines that has lent funds to a business is owed money
DEBTOR
is an individual or business who has borreowed funds from a business and so owes it money