Managing financial resources and decisions Essay

5351 WordsNov 29, 201322 Pages
BUSINESS FINANCE MANAGING FINANCIAL RESOURCES AND DECISIONS GRIGOR GRIGOROV/MRC/20967/NHD MONT ROSE COLLEGE 25.03.2013 Task 1 Programme title HND Business Assessor/Tutor Yannick Fansi Unit 4 – Business Finance Assignment title 1 - Managing Financial Resources and Decisions Student Grigor Petrov Grigorov Date 25/03/2013 1.1 Identify the sources of finance available to a business. There are a number of sources that are available for the businessmen for ensuring that the profits of the business soar. It is important that the selection and choice is taken by critically analyzing the situation. Bank Loan: This the most common type of financing that…show more content…
1.3 Evaluate appropriate sources of finance for a business project. It is important that the decision regarding the sources of finance is taken after careful analysis of the sources. There are two major types of sources of finance for a business, i.e. internal sources of finance and external sources of finance. The internal sources of finance include investing retained earnings, capital, profits of the company and the external sources of finance include finding investors, bank loans, credit etc. These major types are the most common and the most useful types of financing for a business. According to many businessmen, it is very important for the people to use their own money i.e. internal sources of finance for funding the company. This means that the company will be able to make sure that the sources are financed in the right manner. Using external sources of finance is not appropriate for the company due to the costs that are involved. 1.4 Analyze the cost of different sources of finance While analyzing the type of different sources of finance, it is important for the people to ensure that the costs related to the various sources of finance are analyzed as the success of the company depends on these sources. The costs of external sources of finance are quite high as compared to the internal sources of finance.
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