- This topic has 0 replies, 1 voice, and was last updated 4 years ago by akshaykopite19.
- You must be logged in to reply to this topic.
Specially for OpenTuition students: 20% off BPP Books for ACCA & CIMA exams – Get your BPP Discount Code >>
Hello. I can’t understand the difference between permanent and fluctuating current assets. Also, it is said in my Study Book that when some permanent current assets are financed by short term credit, it is more profitable but riskier. On the other hand if all permanent and some fluctuating current assets are financed out of long term sources, it is less profitable but less risky. How come? Can someone explain that to me with an example?
Secondly, Why is equity finance expensive?it is said that because of the risk they suffer shareholders expect high returns, and dividends are not tax deductible. Can someone explain clearly to me what does this mean?