Question
EXERCISE 3: FINANCIAL NEEDS AND FINANCING REQUIREMENTS A company needs $1.2 million to invest in different types of assets and operating expenses to launch a
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EXERCISE 3: FINANCIAL NEEDS AND FINANCING REQUIREMENTS
A company needs $1.2 million to invest in different types of assets and operating expenses to launch a new line of products. With the following information, make a list of the companys financial needs and financing requirements.
Marketing costs
$55,000
Trade receivables
$175,000
Depreciation
50,000
Equipment
500,000
Shareholders
200,000
Suppliers
250,000
Inventories
350,000
Profit for the year
100,000
Working capital loan
100,000
Equipment vendors
200,000
Research and development
120,000
Commercial bank
300,000
- Differentiate between internal and external financing. Give several examples.
3. Discuss the concepts of business risk, financial risk, and instrument risk.
4. Identify the six Cs of credit.
5. How can government agencies help businesses?
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