Question: 1: FINANCING

The junior accounting team has assembled a Financing Report that

(a) offers three options for securing the additional funds required to meet the new order; and

(b) details the criteria Shaun, the owner of SunsTruck, would like you to consider when choosing one of the three options. Based on this report:

• Identify which financing option you think is the best option for SunsTruck to pursue given Shaun's constraints. Underline your selection:

• Option 1: Equity

• Option 2: Debt

• Option 3: Debt + Self-Financing

Explain the rationale for your decision.

Note: You should complete Steps 2 & 3 after reading the material in Week 5.
 
2: ACCOUNTING CYCLE

A junior accountant is working to get everything in order for the new financing and has come to you with a question about what do next in the accounting cycle.

• Read the email the junior accountant sent you and identify the best next step to take in the accounting cycle. Explain your reasoning.

3: FINANCIAL STATEMENTS

A potential investor has been identified, but before it is willing to commit, it has requested information about SunsTruck's current debt from the junior accountants.

• Identify the correct financial statement for your junior accountants that will provide the investor with the information it has requested. Underline your selection:

• Income Statement

• Balance Sheet

• Cash Flow Statement

Explain to your junior accountants why you are giving them this financial statement and where the debt information is located.

4: FINANCIAL ANALYSIS

If you were the type of financier selected in Step 1, would you invest in SunsTruck? Explain the rationale for your decision.