Pls answer this........ /
Solution :-
1) According to First person's opinion, Company needs Cash credit and Overdraft facility.
The Source of Finance suggested by First person is Commercial Banks.
A commercial bank is a financial institution which performs the functions of accepting deposits from the general public and making advances or loans to consumers or businesses with a view to earn profit. Commercial banks charge high rate of interest from borrowers but pay much less rate of interest to their depositors with the result that the difference between the two rates of interest becomes the main source of profit of the banks. Besides these functions, commercial banks perform other functions such as credit creation, transfer of funds, agency jobs and general utility services.
2) According to Second person's opinion, Company should buy goods on credit.
The Source of Finance suggested by Second person is Trade Credit.
Trade credit refers to a system wherein the supplier sells the goods and services to the purchaser but without any receipt of payment on immediate basis. It involves an agreement that the payment would be made at a specified future date.
1) According to First person's opinion, Company needs Cash credit and Overdraft facility.
The Source of Finance suggested by First person is Commercial Banks.
A commercial bank is a financial institution which performs the functions of accepting deposits from the general public and making advances or loans to consumers or businesses with a view to earn profit. Commercial banks charge high rate of interest from borrowers but pay much less rate of interest to their depositors with the result that the difference between the two rates of interest becomes the main source of profit of the banks. Besides these functions, commercial banks perform other functions such as credit creation, transfer of funds, agency jobs and general utility services.
2) According to Second person's opinion, Company should buy goods on credit.
The Source of Finance suggested by Second person is Trade Credit.
Trade credit refers to a system wherein the supplier sells the goods and services to the purchaser but without any receipt of payment on immediate basis. It involves an agreement that the payment would be made at a specified future date.