Accounting 0452 · IGCSE · Sole traders

Sole traders — practice question

Sally’s business has already used up the bank overdraft limit of $1500$ and cannot settle its debts as they become due. Sally is thinking about these options. 1. requesting that the bank raises the overdraft limit to $2000$ 2. taking $2000$ from a relative and repaying it in six months 3. getting a $2000$ loan from the bank that is repayable in two years 4. transferring $2000$ from Sally’s personal bank account into the business bank account Which of these options would increase the business’s working capital?

  • A1 and 2
  • B1 and 4
  • C2 and 3
  • D3 and 4

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