Sources of financing

There are varieties of short term sources of funds available to a company. Which of the followings are short term sources of financing? *can answer more than one

• Trade Credit

• Short term loans

• Bonds

• Preferred stock

This type of financing is normally needed because of uneven flow of cash into the business and the seasonal pattern of business. In most cases, it is used to finance all types of inventory, accounts receivables etc. At times, only specific one-time orders of business are financed. This refers to _______.

• short term financing

• long term financing

• taxes

• interest expenses

Short term finance refers to financing needs for a small period normally _____.

• less than a year

• more than a year

Which of the following is true about bonds?

• Bond is an equity instrument

• Interest is the return for bonds

• Return for bonds are not guaranteed

• Bond holders has voting right in the company

Which of the following is true about stocks?

• Stocks is a debt instrument

• Stockholders get return in the form of interest

• Stocks provide a guaranteed return

• Stockholders has a voting right in the company

Which of the followings are sources of long-term financing? *can answer more than one

• Commercial paper

• Bonds

• Preferred stocks

• Common stocks