Get premium membership and access questions with answers, video lessons as well as revision papers.
The advantages of using retained earnings as a source of finance to the company.
1. It is the largest internal source of finance which the business will use without paying any costs.
2. The use increases the equity base of the company making it possible to generate more debt finance.
3. Retained earnings are used to finance new fixed assets whose value cannot be met by other sources
4. It is used without pre-conditions or restrictions making it the most flexible source of finance.
5. It boosts confidence among the company’s creditors
6. It is a permanent source of finance to the company to be used on long –term investments
lydiajane74 answered the question on May 9, 2018 at 19:28
- Explain why SACCOS are popular among employees(Solved)
Explain why SACCOS are popular among employees.
Date posted: May 9, 2018. Answers (1)
- What are the requirements for the registration of a business name?(Solved)
What are the requirements for the registration of a business name?
Date posted: May 9, 2018. Answers (1)
- Give circumstances under which partnership is illegal (Solved)
Give circumstances under which partnership is illegal
Date posted: May 9, 2018. Answers (1)
- State four differences between power and authority(Solved)
State four differences between power and authority
Date posted: May 9, 2018. Answers (1)
- Outline five features of authority.(Solved)
Outline five features of authority.
Date posted: May 9, 2018. Answers (1)
- Outline six traits of a good leader.
•(Solved)
Outline six traits of a good leader.
Date posted: May 9, 2018. Answers (1)
- Outline nine principles of management according to Henry Fayol.(Solved)
Outline nine principles of management according to Henry Fayol.
Date posted: May 9, 2018. Answers (1)
- Describe five management styles.(Solved)
Describe five management styles.
Date posted: May 9, 2018. Answers (1)
- State five characteristics of perfect competition(Solved)
State five characteristics of perfect competition
Date posted: May 9, 2018. Answers (1)
- Outline the limitations of accounting(Solved)
Outline the limitations of accounting
Date posted: May 9, 2018. Answers (1)
- Outline the characteristics of accounting reporting.(Solved)
Outline the characteristics of accounting reporting.
Date posted: May 9, 2018. Answers (1)
- Outline four internal business environments.(Solved)
Outline four internal business environments.
Date posted: May 9, 2018. Answers (1)
- Describe five types of business activities.(Solved)
Describe five types of business activities.
Date posted: May 9, 2018. Answers (1)
- Effects of outward shift in a supply curve on equilibrium price and quantity(Solved)
Effects of outward shift in a supply curve on equilibrium price and quantity
Date posted: May 8, 2018. Answers (1)
- What are the disadvantages of sales promotion?(Solved)
What are the disadvantages of sales promotion?
Date posted: May 8, 2018. Answers (1)
- Outline advantages of sales promotion(Solved)
Outline advantages of sales promotion.
Date posted: May 8, 2018. Answers (1)
- Explain factors which determine choice of an advertising medium(Solved)
Explain factors which determine choice of an advertising medium.
Date posted: May 8, 2018. Answers (1)
- Explain factors that influence a product promotion(Solved)
Explain factors that influence a product promotion.
Date posted: May 8, 2018. Answers (1)
- Outline steps to be taken in order to maintain secrecy in an organization(Solved)
Outline steps to be taken in order to maintain secrecy in an organization.
Date posted: May 8, 2018. Answers (1)
- Outline Ways of Protecting Business Ideas(Solved)
Outline Ways of Protecting Business Ideas.
Date posted: May 8, 2018. Answers (1)