Bus. Research and Writing Essay Example | Topics and Well Written Essays - 2500 words - 1

Bus. Research and Writing - Essay Example These may include the business plan, bank statements, business history and references. Most business start their operations before the owners decide to expand. This can be done by establishing new ventures or expanding. Some of the new ventures that can be explored include developing new product lines, creating and sustaining a presence in a new geographical area and establishing a new market. Each one of the ventures requires funds in order to be successful. The funds that are required by businesses, organizations or enterprises either to start up new ventures or to bolster already existing ventures may be acquired through external sources or internal sources. The sources of capital usually depend on whether the business or organization is at an early stage of rapid expansion. The first source of capital for any corporation is usually the retained profits. The corporation has to approximate the amount of money required. The retained profits are the profits that are kept by the corporation rather than being distributed as dividends to the shareholders. The profits are retained in the organization and invested in new business ventures. A business can choose to opt for debt financing. This form of financing allows the borrower to use the money borrowed for a specified period provided they repay the money with some interest. In most instances, the terms of the loan are usually outlined in the loan agreement. To ensure that the repayment of the loan is guaranteed, the loan may be backed by â€Å"collateral† for the sake of a secured loan or â€Å"cash flow† for the sake of unsecured loans. A corporation can raise capital through the sale of shares. Essentially, shares relate to public limited companies or private limited companies. â€Å"Shares† are self-explanatory and once one buys a shares form a particular company, they in turn own a share of the company. Shares are