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Vancouver Coffee Shop Co. is planning to expand its business in the next year and needs financing of $200,000 to fulfill its goals. Assume the

Vancouver Coffee Shop Co. is planning to expand its business in the next year and needs financing of $200,000 to fulfill its goals. Assume the Company has no excess cash to finance its expansion; the market interest rate is 5%; the Company has 100,000 shares outstanding with a value of $10 per share, and it estimates that k will earn a net income of $100,000 the next year before considering the cast of financings. What are the two options for the Company to fulfill its financing goals? What are the annual "cost of financing" for each option? Which option is less expensive? Which option is less risky? What are the pros and cons of each option? Which financing option would you recommend Vancouver Coffee Shop to choose? Wee your assumptions/conditions and reasons.

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