What assumptions have you made about demand and price

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Reference no: EM131611576

Milestone Paper Assignemnt

Length: 8-10 pages APA format

Company: L.S. Starrett

This is third milestone which first and second is provided along with paper instructions. There are three parts to this:

Justification:

Financial impact. This section should discuss the project's most likely financial implications and the consolidated financial projection with and without the project. Be sure to:

1. Project the incremental, annual, and cumulative cash benefits and outflows associated with the proposed expansion for the next seven to 10 years, using a spreadsheet or other relevant presentation vehicle to support your narrative. Be sure to justify your assumptions and methodology based on sound microeconomic and financial principles. For example, what assumptions have you made about demand, price, volume, capital purchase costs, incremental hiring, and so on?

2. Develop a consolidated financial projection of revenue, pretax income, and cash flow for the overall business, over that same number of years, both with and without the proposed investment. Use a spreadsheet or other relevant presentation vehicle to support your narrative, being sure to describe any relevant assumptions.

Financing:

In this section, compare the proposed loan to alternative financing methods. Specifically:

A. Weigh the pros and cons of raising money using internal financing mechanisms versus seeking funding through global capital markets via loans, commercial paper, bonds, or equity financing. Which might be viable alternatives should the loan not be approved? Support your answer with appropriate research and evidence.

B. Assess the viability of a business combination as a mechanism for expanding into the new market. Is this a reasonable option for the company? Why or why not? Support your answer with appropriate research and evidence.

Track Record:

A. Convincingly argue that your organization is on solid financial footing, and thus at a low risk for default, supporting your argument with appropriate financial statements, ratios, and other indicators of financial performance and health.

B. Convincingly argue for your organization's trustworthiness, providing credible evidence of legal and ethical financial behavior. For example, this might include recent audit results; credit history; absence of significant lawsuits,

Reference no: EM131611576

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