Short-term Financing

All of the below are the short term sources of funds except:

• Accruals

• Account receivables

• Notes payable

• Commercial paper

Total asset is equal to the sum of temporary plus permanent and spontaneous sources of financing.

• True

• False

It arise in a day-to-day operation such as trade credit, wages and salaries payable, accrued interest and accrued taxes.

• Temporary sources

• Permanent sources

• Aggressive sources

• Spontaneous sources

This approach use short term financing for temporary asset and long term financing for permanent asset.

• Conservative approach

• Aggressive approach

• Maturity matching approach

• Lenient approach

Short term financing refer to

• Additional money a business requires for doing its business

• Additional debt a business requires for doing its business

• Additional asset a business requires for doing its business

• Additional equities a business requires for doing its business

Commercial paper is the examples of secured sources.

• True

• False

Accrual is

• Form of short term financing consist of unsecured promissory notes

• Obtain a good from supplier without immediate payment

• Continually recurring short term liabilities

• Financing application made by company from bank

Accrued wages and taxes are the example of

• Note payable

• Account payable

• Commercial paper

• Accrual

The maturity period ranges from 30 days to 270 days. It refer to.....

• Note payable

• Commercial paper

• Account receivables

• Trade credit

Informal agreement between bank and borrower about maximum amount of credit that provided by the bank on certain period.

• Revolving credit

• Line of credit

• Promissory note

• Accrual