the sources of fixed capital is not 1- issue of debenture 2- issue of share 3- creditors 4- loan from industrial finance corporation of India
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3
Answer:
it is the answer 3 creditore
Answered by
1
Answer:
Option 3 - Creditors
Explanation:
Issue of debentures: They represent the loan capital of a company and creditors are the holders are the debentures.
- Debentures are fixed charged funds.
- They carry a fixed rate of interest.
- This is suitable if the sales and earnings of the company are relatively stable.
Issue of share: The shares provide a preferential right to all the shareholders with respect to repayment of the capital and payment of earnings.
- The people who invest prefer a steady income without any higher risks prefer shares.
Creditors: The holders of debentures are called creditors.
- Creditors are not the source of fixed capital.
Loans: State and Central governments have set up a number of financial institutions all over the country.
- They provide industrial finance to companies that are engaged in business.
- These banks are also called development banks.
- The source of financing is considered suitable when large funds are required for reorganization, modernisation, and expansion of the enterprise.
Hence, creditors if not the source of fixed capital.
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