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Part 1 Discussion Options For Short Term And Long Term Financing And Part 2 Written Assignment How To Finance A New Building

Part 1 Directions:

Discussion – Options for Short-Term and Long-Term Financing and classmate reply

You work in finance and your company is considering buying another company for $10.6 million. Your company does not have $10.6 million in cash and has asked you to evaluate different types of short-term and long-term financing opportunities.

For this assignment, you will have to conduct research to see what options are available for financing this acquisition. Explain why you chose the option you selected and what the short-term and long-term effects of that option will be. Please be specific.

After making your initial substantive post, provide your thoughts and feedback on one or more other student post. Are your thoughts similar or different? Is there any new information or resources you can provide to other students?

Your initial post is due by midweek and a response to one or more other students is due by week end. Refer to the Course Calendar for specific dates.

Part 2

Written Assignment – How to Finance a New Building

  1. The company you work for is considering building a new warehouse and manufacturing facility. The cost of the new buildings will be $6.9 million. Your manager wants you to decide how the company should finance the new building.
    If you decide to finance the construction with debt, then list the type of debt you would encourage the company to undertake and what the anticipated cost of that debt would be. Incorporate current commercial interest rates.
    The company currently has a double AA credit rating. List the advantages and disadvantages of securing a loan from your local financial institution. Also consider the advantages and disadvantages of securing your loan from an angel investor.
    If you decide to finance the construction with equity, decide how much equity you will need to surrender in order to acquire the needed funds. Your company currently has 4 million shares outstanding and carries an estimated value of $24 per share.
    Write a 2-3 page paper that thoroughly addresses the above issues. Be sure to cite your sources in-text and on your reference page. All project work should follow APA standards and include a title and reference page.