Financial Statement Analysis and Firm Performance
The purpose of this assignment is to allow students the opportunity to present a business idea supported by strong financial information. The student will be able to identify the possible challenges of doing business in a foreign country and how to approach them.
Assignment Steps
Resources: Microsoft® PowerPoint®, Signature Assignment: Financial Statement Analysis and Firm Performance Template
Prepare a 16- to 18- slide Microsoft® PowerPoint® presentation showing the details of a business you are interested in starting in a foreign country, and for which you need $300,000. The presentation should include the following information:
Business name
Executive summary
Description of the foreign country
Business description and structure
Market and company analysis
Marketing and sales operational plan
How you plan to use the $300,000
Financial statements forecast (3 years)
Business health assessment – using the following ratios:
Liquidity ratios
Solvency ratios
Asset management ratios
Profitability ratios
Market value ratios
Analyze and calculate the following scenarios in 525 words, including which one would you choose and why, and which financing option is best for your busines:
Investor #1 decided to loan you the $300,000, paying all of the interest (8% per year) and principal in one lump sum at the end of 5 years.
Investor #2 offers you the $300,000, paying interest at the rate of 8% per year for 4 years and then a final payment of interest and principal at the end of the 5th year.
Discuss in 525 words the challenges and risks you may face in starting a business in a foreign country including the following:
Cultural, business, and political risks.
How you plan to avoid operational, transaction, and translation exposure.
Format your assignment consistent with APA guidelines. Scenario 1
Pay all of the interest (8% per year) and principal in one lump sum at the end of 5 years
Amount $ 300,000
Period (years) 5
Interes rate 8%
FV = PV × (1 + r)n
Answer- Total Payment
Interest Paid
Refer to the Solved Example 6 on Page 84 of your text.
Scenario 2
Pay interest at the rate of 8% per year for 4 years and then a final payment of interest and principal at the end of the 5th year;
Amount $ 300,000
Period (years) 5
Interes rate 8%
Answer
Annual Interest Payment-
Year 5 Payment –
Total Payment-
Interest Paid-
Refer to the Solved Example 6 on Page 84 of your text.
Comparison
Total Payment Interest paid
Scenario #1 $ – 0 $ – 0
Scenario #2 $ – 0 $ – 0
Which of the scenarios is the best option?
Answer:
Refer to the Solved Example 6 on Page 84 of your text.
