Table of contents

Introduction 7
Content 8
1. Identify and describe the various source of finance available to business 8
1.1 Short term sources of finance 8
  1.1.1 Bank loan 8
  1.1.2 Overdraft facilities 9
  1.1.3 Trade credit 9
  1.1.4 Leasing: 9
1.2 Long term sources of finance: 10
  1.2.1 Owners’ capital: 10
  1.2.2 Shares: 10
  1.2.3 Venture capital: 11
2. Assess the implications of the different sources of finance to business related to risk, legal, financial and dilution of control and bankruptcy: 12

  2.1 Issued of debts: 12

  2.2 Issued of equity: 13

3. Select appropriate sources of finance for Vale Filers and make recommendations on the best ways of raising finance: 15
4. Assess and compare various costs involved with each sources of finance to Vale Filters: 17
5. Prepare the cash budget for Vale Filters and discuss the importance of financial planning: 19
Conclusion 21
Preferences 21
      Vale Filters is the new business, which produce and sell the new filter in the market. It is owned by Alan Simpson and his colleague Geoff. To help company exist and develop in business market, it is very important to understand the different sources of finance. Since then choose the suitable sources which suitable for the company situation. Vale Filters is still new company but over recent year, it intends to expand into national and international market. To expand the business, the most important thing is know the advantages and disadvantages of different sources of finance to support the best way to increase own capital. Therefore, this report will identify and describe the various sources of finance available to Vale Filters as well as the implications of these different sources of finance in order to make recommendations on the best way of raising finance. Moreover, this report also makes clear their costs, and explaining the importance of financial planning and also analyzing some problems which may occur in...