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What is the difference between internal and external sources of business?

Answer»

Difference between internal & external source: 

Mode  of DifferencesInternal SourceExternal Source
FormationThese are formed inside the business firms only.
For example- selling inventories and reinvesting profits.		These are formed outside the business. they are usually borrowed funds which enterprises need to provide security against.
Example- issue of debentures, accepting public deposits.
Arrangement of fundsThe owner itself arranges the funds.The finance is arranged independent of the owner.
Limit The needs of less amount and time are fulfilled.The needs of longer period and larger amount are fulfilled.


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