AP Inter 1st Year Commerce Notes Chapter 8 Sources of Business Finance-I

Students can go through AP Inter 1st Year Commerce Notes 8th Lesson Sources of Business Finance-I will help students in revising the entire concepts quickly.

AP Inter 1st Year Commerce Notes 8th Lesson Sources of Business Finance-I

→ Finance is considered the lifeblood of any organisation. The success of an industry depends on the availability of adequate finance.

→ Business units need varying amounts of fixed capital depending on various factors such as the nature of business.

→ The purpose of fixed capital for business units is to purchase fixed assets like land and building, plant and machinery an4 furniture and fixtures.

AP Inter 1st Year Commerce Notes Chapter 8 Sources of Business Finance-I

→ For day-to-day operation purpose working capital is required for business units.

→ The sources of funds can be categorized using different basis viz., on the basis of the period, the basis of the ownership, and the source of generation.

→ The funds classified on the basis of the period are long-term finance, medium-term finance, and short-term finance.

→ The funds are classified on the basis of ownership, owner’s funds, and borrowed funds.

→ The funds are classified on the basis of generation- Internal sources of funds and external sources of funds.