Question
Complete the financing portion of Panera Bread Company?s 2007 forecast financial statements, and provide a forecast for the next five years. A worksheet is provided
Complete the financing portion of Panera Bread Company?s 2007 forecast financial statements, and provide a forecast for the next five years. A worksheet is provided for this purpose. As an initial (base case) analysis, assume all borrowings are some form of debt. You may assume the repurchase option occurs in 2008 and that the interest rate on outstanding long-term debt is 6%. Assume sales growth of 25% for 2008 and 2009 and 5% thereafter. Given the need for additional capital, should the company use short-term or long-term debt? Make sure you contrast the desirability of long-term debt versus a short-term line of credit.
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