Final answer:
Permanent current assets should ideally be financed by long-term funds to match the asset's lifespan, with options including reinvesting profits and issuing bonds.
Step-by-step explanation:
A company uses its balance sheet assets, such as short-term investments, inventory, and accounts receivable to borrow money or get a loan and is called asset financing. In other words, a loan obtained by companies based on their financial strength is known as asset financing. Normally, permanent current assets should be financed by long-term funds. This is because permanent current assets such as equipment and buildings have a long useful life and the financing should match the asset's lifespan.
Companies can access financial capital to pay for such long-term assets through various means including reinvesting profits, issuing bonds, or taking loans from banks. Reinvesting profits is one of the key strategies established companies use for financing, as they can reinvest their own profits into buying or upgrading permanent assets without having to rely on external sources.