How seasonal businesses (like fire crackers business,woolen based business,etc.) do get their source of business finance and what type it is and what ia its nature. Explain in brief with reference to last paragraph under heads of period basis in pg 185 of business studies
Dear student,
Seasonal businessmen usually depends on sources of short term finance to finance their business, it includes:
i) Loans from commercial banks: It refers to taking loan or borrowing money from banks for a period not more than 1 year at a certain rate of interest.
ii) Trade credit: it refers to sale of goods and services by supplier to purchaser without immediate payment but with an agreement to pay at future date.
iii) Commercial paper: these are unsecured promissory notes used by one firm towards other for obtaining short term finance for their business for a maturity period ranging from 90 to 364 days.
Regards
Seasonal businessmen usually depends on sources of short term finance to finance their business, it includes:
i) Loans from commercial banks: It refers to taking loan or borrowing money from banks for a period not more than 1 year at a certain rate of interest.
ii) Trade credit: it refers to sale of goods and services by supplier to purchaser without immediate payment but with an agreement to pay at future date.
iii) Commercial paper: these are unsecured promissory notes used by one firm towards other for obtaining short term finance for their business for a maturity period ranging from 90 to 364 days.
Regards