Assess on the costs of various sources of finance Appendix 1.0 Introduction Knowledge Holding Limited is a publicly listed company in New York Stock Exchange since 2001. Knowledge Holding Limited’s core business is in books-retailing related business. Knowledge Holding Limited has over 200 mega-size bookstores located in Europe, Asia-pacific region, North American region, and United States. The company’s directors believe in their business in Vietnam because of some opportunities. First, Vietnam is one of the youngest populations in the world. The youngster is fond of reading book and thirsty for knowledge as well as quality books. Second, there has been increasing foreigners in Vietnam and their demand for quality books is high. Third, Vietnam government has many incentive policies for foreign business enterprises and Vietnam’s entry in to WTO in 2007 provides the necessary advantage for the company. The plan of the company is having no less than 12 mega-size bookstores in the various metropolis cities of Vietnam in the next four years. The business expansion plan faces capital challenges. The company needs at least US$ 27million dollars. There are various alternative sources of finance available to Knowledge Holding Limited. The basic sources of finance comprise equity and debt. Preference shares and ordinary shares are two kind of equity. Retained earnings and issue of new shares are two ways of investment after paying preference dividend and ordinary dividend. Short-term debt and long-term debt are two kinds of debt. 2.0 Sources of finance