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JAMB Commerce 2013 Question 19

Question 19

Business Finance

In order to increase the capital owned, a sole trader may

  1. A.seek for bank loan.
  2. B.issue debentures.
  3. C.acquire extra shop fittings on credit.
  4. D.draw less of his profit for personal use.
Show the answer and explanation

Answer: D (draw less of his profit for personal use.)

Explanation

Profit he leaves in the business adds to his own capital; loans and credit are borrowed, not owned.