Study the following transactions. 1. Raising of short-term loans. 2. Goods purchased for cash. 3. Payment of bonus in the form of shares. 4. Issue of shares in lieu of raw materials. Select the correct answer:

The correct answer is: C. Both 3 and 4

Option 1: Raising of short-term loans is a source of financing, not a use of funds.

Option 2: Goods purchased for cash is a use of funds, but it is not a source of financing.

Option 3: Payment of bonus in the form of shares is a use of funds, and it is also a source of financing, because the company is issuing shares to pay the bonus.

Option 4: Issue of shares in lieu of raw materials is a source of financing, because the company is issuing shares to acquire raw materials.

Therefore, the only options that are both a use of funds and a source of financing are options 3 and 4.