SOURCES OF FINANCE

Sources of finance can be divided into two

  1. Short term sources
    They are refundable after a long period of time i.e. after 3 years They include commercial paper, bank overdraft, loans, promissory notes, treasury bills, bills of exchange letters of credit and hire purchase
  2. Long term sources
    These funds are refundable after a short period of time i.e. a period of 12 years They include equity, rights issue, bonus issue, bonds or debentures, notes payables, lease or buy decision, venture capital and syndicate loans
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