Forms of financing
Debt financing: funds borrowed from a creditor under a legal contractual agreement
Stipulates terms of borrowing and repayment
Legally limits the involvement and influence of the creditor in the firm
Short-term: credit extended by suppliers and short term loans for purchase of goods
This obligation is a Ågcurrent liabilityÅh
Long-term: typically 15 or 30 years
This obligation is a Åglong-term liabilityÅh
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