what is fixed charge? why is it needed?
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A liability of the the creditor which relates to a specific Assets of a company.
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here is your answer..
when a company borrows money to purchase a fixed asset such as lanf ,a building ,or piece of machinery ,the lender will require security in the form of fixed charge . The protects them from the risks of non-payment , and allows repossesstion and sale of the item if the borrower enters insolvency and is liquialdatade
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when a company borrows money to purchase a fixed asset such as lanf ,a building ,or piece of machinery ,the lender will require security in the form of fixed charge . The protects them from the risks of non-payment , and allows repossesstion and sale of the item if the borrower enters insolvency and is liquialdatade
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