Question on: JAMB Commerce - 2012
A business organization can obtain long term financing through
A
bank overdraft
B
the sale of shares
C
credit purchases
D
bureau de change
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Correct Option: B
Long-term financing refers to funds that a business uses for a period of more than one year.
- A. Bank overdrafts are short-term financing options.
- B. The sale of shares provides long-term funding because the money obtained from selling shares is not usually repaid. Shareholders become part-owners of the company.
- C. Credit purchases are a form of short-term financing.
- D. A bureau de change facilitates the exchange of currencies, it does not provide financing.
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