Coopers and Lybrand Ltd :: Papers

Coopers and Lybrand Ltd Coopers and Lybrand Ltd is a private limited telephoner. Finance is postulate throughout a companys life. The type and amount of finance required for a stemma depends on many factors type of phone line, success of firm and differentiate of the economy. There atomic number 18 two main types of money that a company needs Capital expenditure and working capital. Capital expenditure is utilize for buying fixed assets where a large amount of money exactly not often purchased. Working capital is day-to-day money required for running game the business. These are short-term finance which is usually needed to leading t up a business to cover the day-to-day running costs. Long-term capital is utilise to grow or expand and is nonrecreational back over a number of years. There are two main types of finance Internal and external sources of finance. Internal sources of finance numerate from the businesss assets and activities e.g. hold profit, sale of assets, reducing stocks and trade credit. orthogonal sources of finance come from outside the business e.g. commercial banks, building societies, factoring services, venture capital and leasing and hire purchase. The company Coopers and Lybrand can use retained profits as an internal source of finance. Retained profits are when a business had a successful trading year and do a profit after paying all its costs. The business could so use some of that profit to finance future activities .This can be a precise useful source of long term finance, as the business is generating profits. Another internal source of finance is sale of assets, where the business sells its assets such as property, machinery, vehicles etc. Sale of assets is usually used as short term finance however it can be used as long term finance if the asset they sold is very valuable. Coopers and Lybrand are also able to use trade credit. This is when a b usiness normally doesnt pay for things before they take possession of it. They leave behind place orders for supplies and pay for it after receiving