A firm's external financing need is met by:
A) retained earnings.
B) net working capital and retained earnings.
C) net income and retained earnings.
D) debt or equity.
E) owners' equity, including retained earnings.

Question

Quizplus · Accepted Answer

External financing needs require funds from sources outside of the firm's internal operations, such as debt or equity financing. Retained earnings, net working capital, net income, and owners' equity are all internal sources of financing and do not constitute external financing.

A Firm's External Financing Need Is Met By