I have to write on Jackson Automotive INC: here some info on Jackson,

Jackson Automotive Systems produces automotive parts for advanced heating and air conditioning systems, engine cooling systems, fuel injection and transfer systems, and various other engine parts and it supplies them to the automotive industry primarily in Michigan. Like many OEM suppliers for the automotive industry, Jackson cut back production following the financial crisis in 2008. By 2013, the firm is back to operating at capacity. The company experiences a bottleneck in production of some key electronic components and, as a result, is unable to repay its outstanding debt to the bank. In addition, the firm delayed replacing equipment during the downturn and now must replace aging equipment to avoid future production delays. The president approaches the bank for an extension to repay a loan and for an additional loan to cover the new equipment purchase. Before meeting with the loan committee, the president must prepare a presentation on the firm's financial position.At the time of the loan in 2013, there were over 5,000 automotive parts suppliers located in the U.S. less than 200 companies had annunal sale of more than 100 million, while the remaining companies were small.It was early June 2013. Heather James, vice president at the Michigan State Bank, was considering a loan request from a longtime client, Jackson Automotive Systems. Jackson had requested the renewal of an existing term loan with the bank in the amount of $5 million that was originally scheduled to be repaid at the end of the month. Jackson was also seeking to borrow an additional $2.4 million to fund the acquisition of a long-needed piece of equipment, which it planned to purchase in late July. Both loans, which totaled $7.4 million, would be repayable on September 30, 2013. Jackson Automotive Systems, an Original Equipment Manufacturer (OEM) located in Jackson, Michigan, carried product lines in advanced heating and air conditioning systems, engine cooling systems and parts, and fuel injection and transfer systems, as well as various other engine parts.Production of these lines required sophisticated and expensive precision equipment. The company's customers were reliable and reputable automotive assemblers located nearby in the Michigan area. Industry Background At the time of the loan in 2013, there were over 5,000 automotive parts suppliers located in the U.S. Less than 200 companies had annual sales of more than $100 million, while the remaining companies were small producers, representing a highly fragmented market. Small private companies, such as Jackson Automotive Systems, had specialized production lines and relied on sales to local customers. Given the location of the big three U.S. automotive companies, the state of Michigan hosted the largest presence of OEMs in comparison to the rest of the country. The U.S. OEMs experienced a severe slump in production after the 2008 financial crisis, with sales dropping more than 30%. Many suppliers managed to survive the economic downturn by rationing capacity and production. The industry was running at about 55% capacity during the financial crisis.Production of these lines required sophisticated and expensive precision equipment. The company's customers were reliable and reputable automotive assemblers located nearby in the Michigan area. Industry Background At the time of the loan in 2013, there were over 5,000 automotive parts suppliers located in the U.S. Less than 200 companies had annual sales of more than $100 million, while the remaining companies were small producers, representing a highly fragmented market. Small private companies, such as Jackson Automotive Systems, had specialized production lines and relied on sales to local customers. Given the location of the big three U.S. automotive companies, the state of Michigan hosted the largest presence of OEMs in comparison to the rest of the country. The U.S. OEMs experienced a severe slump in production after the 2008 financial crisis, with sales dropping more than 30%. Many suppliers managed to survive the economic downturn by rationing capacity and production. The industry was running at about 55% capacity during the financial crisis.Production of these lines required sophisticated and expensive precision equipment. The company's customers were reliable and reputable automotive assemblers located nearby in the Michigan area. Industry Background At the time of the loan in 2013, there were over 5,000 automotive parts suppliers located in the U.S. Less than 200 companies had annual sales of more than $100 million, while the remaining companies were small producers, representing a highly fragmented market. Small private companies, such as Jackson Automotive Systems, had specialized production lines and relied on sales to local customers. Given the location of the big three U.S. automotive companies, the state of Michigan hosted the largest presence of OEMs in comparison to the rest of the country. The U.S. OEMs experienced a severe slump in production after the 2008 financial crisis, with sales dropping more than 30%. Many suppliers managed to survive the economic downturn by rationing capacity and production. The industry was running at about 55% capacity during the financial crisis

Here is the example:CASE STUDY Funding Jill Morans Retirement Annuity Sunrise Industries wishes to accumulate funds to provide a retirement annuity for its vice president of research, Jill Moran. Ms. Moran, by contract, will retire at the end of exactly 12 years. Upon retirement, she is entitled to receive an annual end-of-year payment of $42,000 for exactly 20 years. If she dies prior to the end of the 20-year period, the annual payments will pass to her heirs. During the 12-year accumulation period, Sunrise wishes to fund the annuity by making equal, annual, end-of-year deposits into an account earning 9% interest. Once the 20-year distribution period begins, Sunrise plans to move the accumulated monies into an account earning a guaranteed 12% per year. At the end of the distribution period, the account balance will be zero. Note that the first deposit will be made at the end of year 1 and that the first distribution payment will be received at the end of year 13. Requirements: 1. Draw a timeline depicting all the cash flows associated with Sunrises view of the retirement money. 2. How large a sum must Sunrise accumulate by the end of year 12 to provide the 20-year, $42,000 annuity? 3. How large must Sunrises equal, annual, end-of-year deposits into the account be over the 12-year accumulation period to fund fully Ms. Morans retirement annuity? 4. How much would Sunrise have to deposit annually during the accumulation period if it could earn 10% rather than 9% during the accumulation period? 5. How much would Sunrise have to deposit annually during the accumulation period if it earned 7% instead of 10%? 6. How much would Sunrise have to accumulate by the end of the year 12 to provide the annuity to Jill Moran if the interest rate on the accumulated funds was 5% instead of 12%? How much would the annual payment need to be during the accumulation period if the rate was 9%? 7. What is the relationship between the rates and the amounts needed to fund the retirement? 8. What are the risks to Sunrise in funding this plan? Executive Summary Sunrise Industries is contractually required to pay its employee, Jill Moran, a retirement pension for 20 years after her retirement. Jill will retire in 12 years. Sunrise will begin funding the pension at the end of this year. Interest rates have been determined and used in the analysis. Discounting the cash outflows back to the present value, it has been determined that Sunrise must accumulate in excess of $300,000 in the next 12 years. This amounts to approximately $15,000 per year in pension funding payments. Management has set up the account and has set the annual payments using current market interest rates. If rates change, management must adjust the payments to reflect these rate adjustments. Introduction Sunrise Industries is establishing a retirement annuity for its employee, Jill Moran. Sunrise must determine how much it will need to fund each year to establish this fund. Key Facts Jill Moran will retire in 12 years. She will receive an annual end-of-year payment of $42,000 for 20 years after her retirement. Sunrise Industries will make equal annual payments into her retirement account for the next 12 years. These funds will be invested and earn an annual rate of 9%. Once Jill retires, the funds will be transferred to an account earning 12% per year. These funds will then be used to distribute the $42,000 to Jill. Statement of the Problem Sunrise management must determine how much will need to be invested to fund Jill Morans retirement. Analysis: Sunrise must establish the payment pattern to determine the funds that will need to be accumulated. The following is a timeline depicting the cash inflows and outflows. Cash input by Sunrise at the end of each yearCash outflow to Jill Moran _/________/______/_______/_____/______/______/______/_____/________/ Y1 Y2 Y3 Y4 Y5Y12 Y13 Y14 Y15. Y32 To determine the amount that Sunrise must input each year, it must be determined how much will need to be accumulated to provide the payouts for years 13 through 32. Using the PV function in Excel, it is determined that Sunrise will need to accumulate $313,716.63 by the end of year 12 in order to pay Jill Moran. Using the PMT function in Excel, it is determined that Sunrise will need to make annual end-of-year payments of $15, 576.24 for the next 12 years. If the interest rate changes, and Sunrise could earn 10% on the accumulated funds, the payment would be reduced to $14,670.43. If the interest rate drops to 7% on the accumulated funds, Sunrise will need to pay $17,537.38 each year (Appendix A). Assuming that the interest rates on the accumulated funds can remain at 9% but that the rate earned on the annual payments drops to 5%, Sunrise will need to accumulate $523,412.83 to fund the retirement. They would then need to make annual payments of $25,987.79 (Appendix A). The analysis shows that if Sunrise can earn higher rates, they will need to input less money each year in order to fund the account. If rates drop, they will need to establish a larger pension and therefore make higher annual payments. The risks to Sunrise lie in the uncertainty of interest rates. It is unrealistic to think that an investment can earn 12% per year. It is probably unrealistic to estimate rates as high as 7 or 9%. Sunrise must be prepared to increase the annual payments as needed to fund the retirement account. Recommendations It is recommended that Sunrise establish the retirement fund and begin making annual year-end payments into this account. These payments should be set based on current rates. Each year, the account should be revisited and the payment amounts adjusted to reflect the most current market interest rates.