Q1. Identify 3 advantages and 3 disadvantages for each option.

Q2. What other factors your friend needs to consider when investing in operating a business?

Q3. Which option would you recommend and why?

Your friend Cindy is investigating the operation of a coffee shop. She has $250,000 cash and is able to borrow another $50,000 if required. Her options are: 1. Purchase of a 'Coffee Club' franchise at $300,000 plus 7.5% royalties. II. Purchase of an independent coffee shop that has been operating successfully for 5 years at a purchase price of $180,000. III. Start her own new coffee shop Your friend knows that you are studying Accounting for Decision Making and seeks your advice about the best option. Required 1. Identify three (3) advantages and three (3) disadvantages for each option. 2. What other factors your friend needs to consider when investing in operating a business? 3. Which option would you recommend? and why? (6+3+1=10 marks)