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Calculation and Description of Viability PDF

   

Added on  2020-10-05

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Task 4

Table of ContentsINTRODUCTION...........................................................................................................................1MAIN BODY ..................................................................................................................................1Task 4. Calculation and description of viability of purchasing new ferry..................................1CONCLUSION................................................................................................................................4REFERENCES................................................................................................................................5

INTRODUCTIONThe investment proposal decision refers to an effective analysis of various investmentalternatives and choosing the best decision which will provide greater return to the business withthe highest cost efficiency. This decision is taken into account after analysing various majorinformations like cost of investment, time required, future return, etc. This report includescalculation and description of viability of investing money in acquiring ferry by Zylla limited.MAIN BODY Task 4. Calculation and description of viability of purchasing new ferryAs per the above scenario, Zylla limited wants to purchase a new ferry and also wants toacquire funds for the acquisition of ferry and to fulfill its working capital requirements (Adrian,and Ashcraft, 2016). For the purpose of fulfilling this requirement, company can generatesources from various short term as well as long term sources. Some major sources of fundingare:short term sources:Bank credits: for the purpose of expansion of business, banks provide short term credit tocompanies. This fund can be used by the Zylla ltd. For its expansion plan. Through bankcredit, company can borrow money either at single time or in installments. Bank loans,bank credits, overdraft are some sources of bank credit (Long-Term & Short-TermFinancing, 2018).Loan from co-operative banks: it can be termed as the best source of short term finance.These banks provide sources for personal as well as business purposes. Funding from co-operative banks could be more beneficial for zylla ltd. as it has lower rate of interest aswell as secured source of funding.Angles: these are some individuals who or companies who provide funds to smallcompanies by directly investing in them. For the purpose of minimizing there risk ofmoney, they reserve their right of supervision of company's management decision. Commercial paper: it is an unsecured promissory note which can be issued by Zylla ltd.To raise money for fulfilling its short term working capital requirement. It is taken bybanks or financial corporations which promises the company to pay a sum of amountequal to the face value of paper at the time of maturity of it. Long term sources1

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