ocr: Reserves Profit earned through successtul trading which is then retained and reinvested in the business is usually called reserves and provides the third and final source of money. Prot - - ye Clearly, when a business starts up, the only two possible sources of money are loan capital and share capital. Keserves can only manitest hemselves after some period of trading. Reserves are the profits ploughed back into the business after having paid any taxes to the government and atter having distributed any profits to the shareholders by way of a dividend. For businesses who grow year on year, and a ...
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