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Sou Rce Of: Own Edc Apita L
Sou Rce Of: Own Edc Apita L
Sou Rce Of: Own Edc Apita L
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Presented By: Jinal Lad
Introduction
It is rightly said that finance is the lifeblood
of business.
No Business can be carried on without
source of finance.
There are several sources of Finance and as
such the finance has to be raised from the
right kind of source.
Brief Introduction
No matter what business you are in, you will always have to
ensure your business is adequately financed (Liquidity).
Classification of sources
According to
period
According to
ownership
According to
source
According to
mode of
finance
Short-term
sources
Owned
capital
Internal
sources
Security
financing
Long-term
Sources
Borrowed
capital
External
sources
Loan
financing
According to Ownership
Owned Capital
Ordinary/Equity shares
Preference shares
Founders /Deferred shares
Retained Earnings
Ownership
capital
Nonownership
capital
External source
s
Owners Fund
Owners fund or owners capital refers to
fund invested by the owners of the
company.
Owners fund comprise of preference
shares, equity shares, retained earnings.
Equity Shares
Equity shares were earlier known as ordinary
shares. The holders of these shares are the real
owners of the company.
They have a voting right in the meetings of
holders of the company. They have a control
over the working of the company.
Equity shareholders are paid dividend after
paying it to the preference shareholders.
Preferred Shares
Preferred shares represent an ownership share
in a company -- in other words, a claim on its
assets (property) and earnings.
While preferred shares usually do not carry the
same voting rights as common shares, they do
have priority when it comes to dividends
and bankruptcy.
Retained Earnings
Retained earnings means that part of
trading profits which is not distributed in
the form of dividends but retained by
directors for future expansion of the
company.
Reference
http://www.scribd.com/doc/39664871/
Wikipedia page: Sources of Finance
Thank You.