Equity And Debt Active Reasoning Research Proposal

PAGES
2
WORDS
666
Cite

" (Small-business financing: Debt vs. equity) Venture capital is a better route than an initial public offering for an early stage startup such as Active Reasoning that lacks the size and stability required for becoming a public company. By taking on equity financing, the company's executives are well aware that they will be giving away partial ownership of the business in exchange for money and that this will have a significant impact on management's ability to make certain decisions (Equity financing). Even so, management considers debt financing too risky at this point in time when it is not certain if the company will have stable cash flows to make monthly debt payments. Management fears that high interest costs during difficult financial periods could potentially lead to insolvency (Debt vs. equity -- advantages and disadvantages) and does not need the tax write off for the interest on debt since it does not expect to be profitable for several years. Further, the management team sees an advantage in venture capitalists who can bring in skills, contacts,...

...

The CEO wants to make sure that he partners with the right venture capital company, one that shares a common philosophy and vision for the company so that joint decision making will not be an issue.
Thus, as this paper has discussed, Active Reasoning can apply debt financing and equity financing where most beneficial to its needs. Working with a short time frame, the loan is best for the server. but, venture capital is the better option for a large amount of money to fund continuous operations.

Bibliography

Debt vs. equity -- advantages and disadvantages. http://smallbusiness.findlaw.com/banking_financing/be1_5debtvsequity.html

Equity financing. http://www.answers.com/topic/equity-financing

Small-business financing: Debt vs. equity. http://finance.yahoo.com/how-to-guide/career-work/12825

What are the advantages and disadvantages of debt financing? (2007). http://bondsdebt.net/Debt/debt-financing-advantages/

Sources Used in Documents:

Bibliography

Debt vs. equity -- advantages and disadvantages. http://smallbusiness.findlaw.com/banking_financing/be1_5debtvsequity.html

Equity financing. http://www.answers.com/topic/equity-financing

Small-business financing: Debt vs. equity. http://finance.yahoo.com/how-to-guide/career-work/12825

What are the advantages and disadvantages of debt financing? (2007). http://bondsdebt.net/Debt/debt-financing-advantages/


Cite this Document:

"Equity And Debt Active Reasoning" (2009, August 31) Retrieved April 24, 2024, from
https://www.paperdue.com/essay/equity-and-debt-active-reasoning-19698

"Equity And Debt Active Reasoning" 31 August 2009. Web.24 April. 2024. <
https://www.paperdue.com/essay/equity-and-debt-active-reasoning-19698>

"Equity And Debt Active Reasoning", 31 August 2009, Accessed.24 April. 2024,
https://www.paperdue.com/essay/equity-and-debt-active-reasoning-19698

Related Documents

As far as regional sales are concerned, U.S. business sales comprise the most sales (Annual Report, p. 58). This is not surprising because Dell's home country is the U.S. The other markets represent emerging markets and represent excellent chances for growth in the future. However, they are not yet established. Dell established its core business in the U.S. before it began to branch out into other markets. These secondary

It is also interesting to comment on the article's evaluation of the potential future trends for the companies in developing countries. The article evaluates a closer integration of these companies in the global market. This is something that is potentially bound to happen. Indeed, these companies are already playing a more important role on a regional level by investing in neighbor economies. Recently, a Kazakh corporation purchased a Romanian fuel

Arconti the Issue Here Is
PAGES 3 WORDS 761

Bart and George were also not engaged in any fraudulent activities that were part of the reasoning behind the trial court's findings against them. Maryland's law states that the shareholders will be held responsible if they fail to observe the corporate entity or they operate the business or deal with the corporation's property as if it were their own. I just result in this particular case would probably have consisted of

validity of establishing Section 115 by the FASB. It has 4 sources. The FASB (Financial Accounting Standards Board) in the recent years have revised many accounting standards and policies to effectively govern corporations for the benefit of the public. In its attempt to curtail the unaccounted for incomes and earnings, the FASB issued the FASB No.115 section in which it states that companies reporting their financials can determine their investment

Indian Stock and Bond Markets Do you think an investment in the Indian stock market is a good long-term investment? The Indian stock market has experienced a number of fluctuations over the past 20 years or so that would suggest that investors might want to adopt a "wait-and-see" approach before making the plunge into these financial waters. For example, Schmidt and Hersh emphasize that, "The history of the operation of the

Accounting Approach to Valuation by GAAP and IFRS: Key Differences When it comes to valuation by U.S. GAAP and IFRS, there exists a number of differences in terms of the approaches used. To begin with, in regard to inventory valuation, both FIFO and LIFO are permitted in the case of U.S. GAAP. On the other hand, IFRS do not permit the usage of LIFO. However, in the latter case, FIFO is permitted