Discuss the suitability of the various sources of finance a large business might use when replacing old machinery

Suitability of sources of finance to a large business.

1. Company savings. A business may use its savings when replacing old machinery. The benefit of this kind of financing is that it's readily available and does not accrue any interest, as in the case of a loan.
2. Bank loan. The business may take a bank loan to purchase new machinery. Its a suitable method of financing where the company has no adequate finance to buy the machinery.
3. Trade credit. This is where the supplier delivers the item but accepts to receive payment later. It suitable where the business has no adequate resources and the machinery is urgently required.