Which source of short-term finance allows a business to buy goods now and pay the supplier later?
Correct answer: A. Trade credit
- A. Trade credit
- B. Preference shares
- C. Debenture finance
- D. Retained earnings
Explanation
Trade credit arises when suppliers allow the buyer a period to pay for purchased goods or services. Preference shares and debentures are longer-term financing instruments, while retained earnings are internally generated funds.
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