Harvard Business Publishing: Working Capital Simulation: Managing Growth Assignment
Ch. 1 - 21 ofFundamentals of Corporate Finance
All additional resources from each week
Review the following scenario:
Acting as the CEO of a small company, you will apply the principles of capital budgeting to invest in growth and cash flow improvement opportunities in three phases over 10 simulated years. Each opportunity has a unique financial profile and you must analyze the effects on working capital. Examples of opportunities include taking on new customers, capitalizing on supplier discounts, and reducing inventory.
You must understand how the income statement, balance sheet, and statement of cash flows are interconnected and be able to analyze forecasted financial information to consider possible effects of each opportunity on the firm's financial position. The company operates on thin margins with a constrained cash position and limited available credit. You must optimize use of internal and external credit as you balance the desire for growth with the need for maintaining liquidity.
Sign-in to the simulation and review each of the following:
- Welcome Statement
- How to Play
- Terminology Primer
- More Details (this includes information to help you understand how to play the simulation)
Write a paper of no more than 1,400 words that analyzes your decisions during each phase (1-3) and how they influenced each of the following final outcomes (metrics) of SNC:
- Net Income
- Free Cash Flow
- Total Firm Value
Address the following in your paper:
- A summary of your decisions and why you made them
- How they affected SNC's working capital
- What general effects are associated with limited access to financing
Include scholarly references (in addition to your course textbook and simulation materials) to support your positions.
Format your paper consistent with APA guidelines.
Click the Assignment Files tab to submit your assignment.
FIN 571 Week 6 Signature Assignment Short Term Funding (2 PPT)
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About Your Signature Assignment: This signature assignment is designed to align with specific program student learning outcome(s) in your program. Program Student Learning Outcomes are broad statements that describe what students should know and be able to do upon completion of their degree. The signature assignments may be graded with an automated rubric that allows the University to collect data that can be aggregated across a location or college/school and used for program improvements. Purpose of Assignment: The purpose of this assignment is to allow the student an opportunity to apply their understanding of cash flow management, break-even analysis, and short-term and long-term financing in starting and growing a business. The assignment will be presented to the class giving the real world scenario of presenting a proposal to investors. Resources: OECD Database, Corporate Finance Prepare a 15-slide PowerPoint® content presentation with speaker notes requesting initial funding of $500,000 to start and run a start-up company. The proposed start-up company could be an existing business model (coffee shop, pet store, etc.) or could be something entirely new and exciting. Create the presentation in the following format, with at least one slide to cover each of the following areas: 1. Title Page 2. Table of Contents 3. Executive Summary 4. Information about the Industry 5. Marketing Plan 6. Competitor Analysis 7. 3 Year Income Statement (Profit & Loss) Projections 8. Include your assumptions for why and how you will achieve your sales growth and what significant expenses and investments you expect to incur to achieve your revenue goals. Assumptions: Sales Growth, Significant Expenses and Investments 9. 3 Year Proposed Funding Schedule (Sources and uses of the funds received.) 10. Break-Even Analysis Review the following scenarios and assumption, and explain how it impacts your decision to expand: Each should have its own slide just as above; 11. After Year 3, the investors are interested in your company expanding internationally to possibly outsource labor or to reduce manufacturing costs. What countries would you expand to first, and why? What factors would you need to consider in making this decision? Global Expansion: Labor/Mfg. Costs. Country? 12. What is the corporate tax rate in the countries you are considering expanding your business to, and how will that affect your decision to expand globally? (Use OECD Database or another resource to determine the corporate tax rate). 13. The investors want to see a decision tree detailing the decisions you would make if you received $300K now and $200K at the end of three years instead of $500K up front. 14. The investors would like your team to provide advantages and disadvantages of using debt financing versus selling company stock to raise capital for growth. 15. Briefly explain the venture capital process. Does it make sense for your company to raise funds through venture capital? 16. Academic and Business References 17. Feedback Format your presentation consistent with APA guidelines. You must present this assignment in class to earn full credit. Students who do not present will have a 50% reduction in grade. Click the Assignment Files tab to submit your assignment.