Which of the following is not considered to be an appropriate form of finance for capital investment projects?

Start networking and exchanging professional insights

Next Question:
Which of the following is an example of a capital investment project?
Posted by:
Emad Mohammed said abdalla
03-August-2015

(a) An issue of share capital. (b) A bank overdraft. (c) The issue of a debenture. (d) Leasing.

Team Management Financial Accounting Internal Audit Financial Management Financial Systems Implementation

Question added by Deleted user
Date Posted: 2013/08/25

Upvote (4) Views (10) Followers (4) Answers (5) Report Question

Write an Answer
Register now or log in to answer.

5 Answers

by Deleted user

A bank overdraft

Upvote (2)

Downvote Reply () Report

by Nagoorammal Abdul Rahman , Finance Manager , Vox Spectrum Limited

Answer is B: Bank overdraft.
BOD is not a suitable form of financing for a capital investment since it is a short term financing.
Issuance of cpital, debentures, leasing is the best solution to opt.

Upvote (1)

Downvote Reply () Report

by Kamran Anjum , Head of Internal Audit , Rafhan Maize Products Company limited, Faisalabad, Pakistan, Ingredion Incorporated Gmbh

Option B is the right answer. A bank overdraft cannot be considered as appropriate form of finance for Capital Investment Projects. However, bank overdraft can be utilized to meet the working capital requirements.

Upvote (0)

Downvote Reply () Report

by Divyesh Patel , Assistant Professional Officer- Treasury , City Of Cape Town

Answer is B- A bank overdraft

Upvote (0)

Downvote Reply () Report