Managing Financial Resources & Decisions Assignment (Doc)

Added on -2020-11-23

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MANAGING FINANCIALRESOURCES & DECISIONS
TABLE OF CONTENTS1.3 Evaluating the appropriate sources of finance......................................................................12.3 Assessment of information required for decision on financial takeover through:................22.4 Impact on financial statements on basis of venture capitalist and finance broker................34.1 Key components of financial statements...............................................................................3REFERENCES................................................................................................................................5
1.3 Evaluating the appropriate sources of financeBank loanAdvantagesLoans could be tied for lifetime of equipment or with assets borrowing money to repay.It could be easily procure for medium and short term financing as well (Kraemer-Eis &et.al. 2018).The interest paid on bank loan is replicated as tax deductible expenditure.DisadvantagesThere are various bank loans which carries prepayment penalty.Too much borrowing as bank could lead to reduced cash flow.With context to various cases, bank does not disburse entire amount of applied loan forpaying lower cash comparatively to demanded loan.Angel investorsAdvantagesThese provides required startup funds and helps for filling equity gap.Angles makes various flexible business agreements along with contributing experienceand knowledge. They are capable for undertaking high risk and even they do not need any monthly fees.DisadvantagesThey rarely offer additional investment.With context to exchange for investment, they might require certain percentage of equityor stake as they could be expensive (Kliestik & et.al. 2018).The interference of angel might lead to problems. Venture capitalAdvantagesThe innovative projects are funded via venture capital which provides huge profitabilityfor long run perspective.It offers valuable information, technical assistance, resources etc. for attaining success.DisadvantagesIts benefit from funding could be realized for only for long term not for short term.It is uncertain form of financing.1

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