Questions On Sources Of Finance

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In this assignment, four different sources of finance preferably two short term and two long term sources of funding will be discussed and identified. Secondly, it will also talk about and select to non-financial companies listed on the London Stock Exchange and will find their most current financial statements based on the last 5 years. I have selected Tesco and Sainsbury’s as my two non financial companies. Thirdly, I will then define and converse the pros and cons of each source of funding and compare and contrast between one another. In addition, will be evaluating the differences and compare the two non-financial companies over the 5 year phase. I will then calculate the financial values through my research and provide figures and…show more content…
Failure to do so could lead to financial downturn and loss of using the property again. Bank Overdraft – Bank Overdraft is a service given from the bank to a customer which allows them to withdraw cash even after the account reaches zero. This is to be paid with interest unless you have a student account which allows you to do so without interest up to a specific amount. Bank overdraft is also a short term service of funding. Pros: Overdraft is easy to manage and helps in case of an emergency when you do not have cash in your account. The service of a bank overdraft is quick and easy to arrange and will be serviced in your time of need. Cons: The overdraft service carry interest fees which are often higher than the fees for a loan. You will also face a high rate of charge if you exceed the agreed overdraft limit. The bank can also recall the gifted overdraft at any particular time if you fail to make payments or if you have breached the terms and conditions. Security can be affected if payments are not met where the bank have no choice but to take personal assets to make up the payment. Bank Loans - A bank loan is a source of finance given to a customer from the bank to be paid back on or before a set date with interest (businessdictionary.com, 2014) This is the most common source of finance especially for potential business owners that do not have enough capital to start up a business and turn to the bank for capital. There are many
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