Revision Notes For Class 11 Business Studies Chapter 8 Sources Of Business Finance

Sources of business finance is a chapter that furnishes an outline of the different sources from where the finance can be acquired. It covers different concepts like – meaning, nature and significance of business finance, classification of sources of funds – period basis, source of generation basis, sources of finance, retained earnings – merits and demerits, trade credit – merits and limitations, factoring – advantages and disadvantages, lease financing, public deposits, commercial paper (CP), issue of shares, debentures, commercial bank, financial institutions, international financing.

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Frequently asked Questions on CBSE Class 11 Business Studies Notes Chapter 8: Sources of Business Finance

What is ‘Trade credit’?

Trade credit is a type of commercial financing in which a customer is allowed to purchase goods or services and pay the supplier at a later scheduled date.

What is ‘lease financing’?

Lease financing is a contractual agreement between the owner of the asset who grants the other party the right to use the asset in return for a periodic payment and the other party who is the user of such assets.

What is a ‘debenture’?

A debenture is a type of debt instrument that is not backed by any collateral and usually has a term greater than 10 years.

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