Finance 571

In: Business and Management

Submitted By carolinaguzmar
Words 1807
Pages 8
Guillermo Furniture Store Financial Analysis Guillermo needs to implement a new business strategy to remain competitive in business and with foreign manufacturers. Guillermo furniture business is viable because it meets the criteria of a successful business; new competition and diversification of his business after the competition entered the market. This paper will analyze three possible alternatives for Guillermo to remain competitive in business, implement a sensitive analysis to evaluate possible alternatives, determine the optimal weighted average cost of capital, discuss the use of multiple valuation in reducing risks, and calculate the net present value of future cash flows for each alternative.
Analysis of Different Alternatives The company faces three possible alternatives to remain in business. The First alternative would be to distribute the furniture he sells at rock bottom prices against his new competition, while developing and marketing the patented process for creating a coating for his furniture. The invention of the flame retardant spray could take off if he attempts to market it globally; the distribution side can keep steady income coming in for him while he tries to make bigger profits of his “invention.” Guillermo would need to initiate the patent process to creating a coating for his furniture. Current, IRR is 6.9% where as the cost of capital is 9.17%, Second alternative is the Hi-Tech system that could decrease labor by using robots instead of live operators to perform the precise movement to furniture assembly at a faster and smoothly operation on a 24 hour shift to offset by reducing the cost in labor. Cost of capital is a required return on Guillermo existing operations, which the current cost of capital of $195,564 of net income before taxes can replicate the total risk of the entire business existing assets, but the new…...

Similar Documents

Finance

...Financial Concepts Keith Fiola FIN 571 University of Phoenix April 22, 2013 Francisco Monserrate Introduction Guillermo’s Furniture manufacturing was originated and located in Sonora, Mexico. The owner, Guillermo Navallez, started the business in his hometown because the timber was plentiful, the labor was inexpensive and his price points for the furniture were at a premium because there were no other manufacturers at the time. In the late 1990’s the business took on hard times because an overseas competitor entered the market. The competitor utilized an automated process which made the production costs low and in turn made the overhead for his products decreased lowering the overall retail costs for their products. A large retailer opened for business in the hometown which caused the labor rates in the area to rise also contributing to Guillermo’s increasing production issues. The labor wages in complement with the overseas caused the owner to look into alternative methods for his business. The Principal of Self-Interested Behavior This principle came into effect with the owner realizing that his business was taking a financial hit when the other competitors came into play. He realized that the business was going to be economically challenged with the additional players and in his self-interest he realized the need for change. This basic principle was realized and the owner placed an emphasis on self-preservation in his business venture. The......

Words: 821 - Pages: 4

Mkt 571

...Week 5 Assignment José A. García Rosario The University of Phoenix FIN 571 - Foundations of Corporate Finance December 05, 2013 Prof. Ismael Torres-Pizarro Growth Rate The total numbers of copies that the publisher expects to sell in the year number three is 92,016 copies. The total numbers of copies that the publisher expects to sell in the year number four is 101,218 copies. 0 1 2 3 4 |_________________|_______________|________________|_______________| Year 53,250 63,900 76,680 92,016 101,218 Year one FV³ = PV x (1 + g) ³ = 53,250 x 1.2 = 63,900 Year two FV³ = PV x (1 + g) ³ = 63,900 x 1.2 = 76,680 Year three FV³ = PV x (1 + g) ³ = 76,680 x 1.2 = 92,016 Year four FV³ = PV x (1 + g) ³ o ( 1+g)4 = 92,016 x 1.1 = 101,218 Multiple compounding periods a- The present value of $3,500 in five years is $5,360.53 dollar. FVn = PV x (1 + i) n = $3,500 x (1 + 0.089)5 = $3,500 x 1.5315788 = $5,360.53 b- FVn = PV x (1+I / m) m x n = $3,500 x (1 + 0.066 / 4) 4 x 8 = $3,500 x (1 + 0.0165) 32 = $3,500 x 1.688248044 = $5,908.87 c- FV daily = PV x (1 + I/m) m x n = $3,500 x (1 + 0.043 / 365) 365 x 4 =...

Words: 496 - Pages: 2

Finance

...Steven W. Simmons Sr. University of Phoenix Business Structures Fin/571 – Corporate Finance Oscar Lewis August 16, 2014 Business Startup When making important business decisions, the concepts of corporate finance tend to be the best model to use. These concepts offer proven methods, which improve the financial success. Discussed below are basic corporate financial concepts, which can be applied and yield positive results. Principles of Corporate Finance When dealing with business investments most commercial entities have used corporate financing in the company. The principle of self-interested behavior is the principle which creates a financial advantage for all parties involved when the playing field is equal or all components associated with the deal are equal. As we strive to gain a deeper comprehension of business transactions through human behavior we find that each of the 12 principles carry invaluable weight to the success or failure of the company. Comparative advantage, diversification, options, risk-return tradeoff, signaling, and valuable ideas are some of the principles used in business dealings. Financial principles, financial markets, and business ethics form a foundation for the financial decisions that managers routinely make. Accounting Net Income and Cash Flows Changing a business from one process or industry to another will completely alter the process of recording......

Words: 427 - Pages: 2

Finance

...Stock Valuation Colin Branch, Ruth Whitehead, Jahna Woodbury, Cynthia Sanshez, and Kathryn Woods FIN/571 March 16, 2015 Oscar Lewis Stock Valuation To understand how investors and markets value stocks it is important to understand what stocks are and how they differ from bonds, the primary evaluation tool used to value stocks, and the consumer tools that are at our disposal to give us data about the value to stock. Stock Ownership is owning capital lifted by a company through issue and subscription of shares. It is also owning the goods that are kept on the structure of a business available for sale or distribution. The owners of the stock have some type of security for the company which represents that portion of the company, which the owner would own of the business. The difference between stock ownership and bond owners is legal tenders to certain guarantees. Bond owners do not own the business but are entitled to assets in the case of a default, whereas stockholders are the recipients of the growth or decline in company value. There are 2 types of stock ownership, common and preferred. Common stocks are commonly known as common shares. These stocks generally encase the rights in a business and the entitlement or surpluses on a percentage of earnings. Stockholders have the right to one election per portion to choose a board membership. The person or board membership chosen administers the critical decisions adopted by the organization (Parrino, Kidwell, &...

Words: 814 - Pages: 4

Fin 571 (Foundations of Corporate Finance) Entire Course - New

...FIN 571 (Foundations of Corporate Finance) Entire Course - NEW IF You Want To Purchase A+ Work Then Click The Link Below , Instant Download http://www.hwnerd.com/FIN-571-Foundations-of-Corporate-Finance-Entire-Course-NEW-65434555.htm?categoryId=-1 If You Face Any Problem E- Mail Us At CONTACT.HWNERD@Gmail.Com FIN 571 Complete Week 1 NEW FIN 571 Week 1 DQ 1 NEW Minimizing risk is essential in the pursuit of maximizing profits. Why shouldn't a firm focus purely on maximizing profits without regard to risk? How does the management of risk play a role in the success of an organization? FIN 571 Week 1 DQ 2 What is ethics? If you follow all applicable rules and regulations, are you an ethical person? Why? FIN 571 Week 1 Individual Assignment Business Structures Watch the "Your Business Structure" and "Corporate Business Structures" videos on the Electronics Reserve Readings page. Identify the different business structures. Write a 350 to 700 word explanation of how each business structure might and might not be advantageous. Click the Assignment Files tab to submit your assignment. FIN 571 Week 1 WileyPLUS Assignment Practice Quiz FIN 571 Complete Week 2 NEW FIN 571 Week 2 DQ 1 NEW Explain what benchmarks are, describe how they are prepared, and discuss why they are important in financial statement analysis. FIN 571 Week 2 DQ 2 NEW Financial Ratios and Firm Performance FIN 571 Week 2 DQ 3 NEW The DuPont System ...

Words: 1571 - Pages: 7

Fin 571 (Foundations of Corporate Finance) Entire Course - New

...FIN 571 (Foundations of Corporate Finance) Entire Course - NEW IF You Want To Purchase A+ Work Then Click The Link Below , Instant Download http://www.hwnerd.com/FIN-571-Foundations-of-Corporate-Finance-Entire-Course-NEW-65434555.htm?categoryId=-1 If You Face Any Problem E- Mail Us At CONTACT.HWNERD@Gmail.Com FIN 571 Complete Week 1 NEW FIN 571 Week 1 DQ 1 NEW Minimizing risk is essential in the pursuit of maximizing profits. Why shouldn't a firm focus purely on maximizing profits without regard to risk? How does the management of risk play a role in the success of an organization? FIN 571 Week 1 DQ 2 What is ethics? If you follow all applicable rules and regulations, are you an ethical person? Why? FIN 571 Week 1 Individual Assignment Business Structures Watch the "Your Business Structure" and "Corporate Business Structures" videos on the Electronics Reserve Readings page. Identify the different business structures. Write a 350 to 700 word explanation of how each business structure might and might not be advantageous. Click the Assignment Files tab to submit your assignment. FIN 571 Week 1 WileyPLUS Assignment Practice Quiz FIN 571 Complete Week 2 NEW FIN 571 Week 2 DQ 1 NEW Explain what benchmarks are, describe how they are prepared, and discuss why they are important in financial statement analysis. FIN 571 Week 2 DQ 2 NEW Financial Ratios and Firm Performance FIN 571 Week 2 DQ 3 NEW The DuPont System ...

Words: 1571 - Pages: 7

Fin 571 (Foundations of Corporate Finance) Entire Course - New

...FIN 571 (Foundations of Corporate Finance) Entire Course - NEW IF You Want To Purchase A+ Work Then Click The Link Below , Instant Download http://www.hwnerd.com/FIN-571-Foundations-of-Corporate-Finance-Entire-Course-NEW-65434555.htm?categoryId=-1 If You Face Any Problem E- Mail Us At CONTACT.HWNERD@Gmail.Com FIN 571 Complete Week 1 NEW FIN 571 Week 1 DQ 1 NEW Minimizing risk is essential in the pursuit of maximizing profits. Why shouldn't a firm focus purely on maximizing profits without regard to risk? How does the management of risk play a role in the success of an organization? FIN 571 Week 1 DQ 2 What is ethics? If you follow all applicable rules and regulations, are you an ethical person? Why? FIN 571 Week 1 Individual Assignment Business Structures Watch the "Your Business Structure" and "Corporate Business Structures" videos on the Electronics Reserve Readings page. Identify the different business structures. Write a 350 to 700 word explanation of how each business structure might and might not be advantageous. Click the Assignment Files tab to submit your assignment. FIN 571 Week 1 WileyPLUS Assignment Practice Quiz FIN 571 Complete Week 2 NEW FIN 571 Week 2 DQ 1 NEW Explain what benchmarks are, describe how they are prepared, and discuss why they are important in financial statement analysis. FIN 571 Week 2 DQ 2 NEW Financial Ratios and Firm Performance FIN 571 Week 2 DQ 3 NEW The DuPont System ...

Words: 1571 - Pages: 7

Fin 571 (Foundations of Corporate Finance) Full Course - New

...FIN 571 (Foundations of Corporate Finance) Full Course - NEW IF You Want To Purchase A+ Work then Click The Link Below For Instant Down Load http://www.acehomework.net/wp-admin/post.php?post=238&action=edit IF You Face Any Problem Then E Mail Us At JOHNMATE1122@GMAIL.COM FIN 571 Complete Week 1 NEW FIN 571 Week 1 DQ 1 NEW Minimizing risk is essential in the pursuit of maximizing profits. Why shouldn't a firm focus purely on maximizing profits without regard to risk? How does the management of risk play a role in the success of an organization? FIN 571 Week 1 DQ 2 What is ethics? If you follow all applicable rules and regulations, are you an ethical person? Why? FIN 571 Week 1 Individual Assignment Business Structures Watch the "Your Business Structure" and "Corporate Business Structures" videos on the Electronics Reserve Readings page. Identify the different business structures. Write a 350 to 700 word explanation of how each business structure might and might not be advantageous. Click the Assignment Files tab to submit your assignment. FIN 571 Week 1 WileyPLUS Assignment Practice Quiz FIN 571 Complete Week 2 NEW FIN 571 Week 2 DQ 1 NEW Explain what benchmarks are, describe how they are prepared, and discuss why they are important in financial statement analysis. FIN 571 Week 2 DQ 2 NEW Financial Ratios and Firm Performance FIN 571 Week 2 DQ 3 NEW The DuPont System FIN 571 Week 2 Learning Team Reflection NEW Read the Ethics case...

Words: 1568 - Pages: 7

Fin 571 (Foundations of Corporate Finance) Full Course – New

...FIN 571 (Foundations of Corporate Finance) Full Course – NEW IF You Want To Purcahse A+ Work then Click The Link Below For Instant Down Load http://www.acehomework.net/?download=fin-571-foundations-of-corporate-finance-full-course-new IF You Face Any Problem Then E Mail Us At JOHNMATE1122@GMAIL.COM FIN 571 Complete Week 1 NEW FIN 571 Week 1 DQ 1 NEW Minimizing risk is essential in the pursuit of maximizing profits. Why shouldn’t a firm focus purely on maximizing profits without regard to risk? How does the management of risk play a role in the success of an organization? FIN 571 Week 1 DQ 2 What is ethics? If you follow all applicable rules and regulations, are you an ethical person? Why? FIN 571 Week 1 Individual Assignment Business Structures Watch the “Your Business Structure” and “Corporate Business Structures” videos on the Electronics Reserve Readings page. Identify the different business structures. Write a 350 to 700 word explanation of how each business structure might and might not be advantageous. Click the Assignment Files tab to submit your assignment. FIN 571 Week 1 WileyPLUS Assignment Practice Quiz FIN 571 Complete Week 2 NEW FIN 571 Week 2 DQ 1 NEW Explain what benchmarks are, describe how they are prepared, and discuss why they are important in financial statement analysis. FIN 571 Week 2 DQ 2 NEW Financial Ratios and Firm Performance FIN 571 Week 2 DQ 3 NEW The DuPont System FIN 571 Week 2 Learning Team......

Words: 1570 - Pages: 7

Fin 571 (Foundations of Corporate Finance) Full Course - New

...FIN 571 (Foundations of Corporate Finance) Full Course - NEW IF You Want To Purchase A+ Work then Click The Link Below For Instant Down Load http://www.acehomework.net/?download=fin-571-foundations-of-corporate-finance-full-course-new IF You Face Any Problem Then E Mail Us At JOHNMATE1122@GMAIL.COM FIN 571 Complete Week 1 NEW FIN 571 Week 1 DQ 1 NEW Minimizing risk is essential in the pursuit of maximizing profits. Why shouldn't a firm focus purely on maximizing profits without regard to risk? How does the management of risk play a role in the success of an organization? FIN 571 Week 1 DQ 2 What is ethics? If you follow all applicable rules and regulations, are you an ethical person? Why? FIN 571 Week 1 Individual Assignment Business Structures Watch the "Your Business Structure" and "Corporate Business Structures" videos on the Electronics Reserve Readings page. Identify the different business structures. Write a 350 to 700 word explanation of how each business structure might and might not be advantageous. Click the Assignment Files tab to submit your assignment. FIN 571 Week 1 WileyPLUS Assignment Practice Quiz FIN 571 Complete Week 2 NEW FIN 571 Week 2 DQ 1 NEW Explain what benchmarks are, describe how they are prepared, and discuss why they are important in financial statement analysis. FIN 571 Week 2 DQ 2 NEW Financial Ratios and Firm Performance FIN 571 Week 2 DQ 3 NEW The DuPont System FIN 571 Week 2 Learning Team......

Words: 1570 - Pages: 7

Fin 571 (Foundations of Corporate Finance) Full Course – New

...FIN 571 (Foundations of Corporate Finance) Full Course – NEW IF You Want To Purcahse A+ Work then Click The Link Below For Instant Down Load http://www.acehomework.net/?download=fin-571-foundations-of-corporate-finance-full-course-new IF You Face Any Problem Then E Mail Us At JOHNMATE1122@GMAIL.COM FIN 571 Complete Week 1 NEW FIN 571 Week 1 DQ 1 NEW Minimizing risk is essential in the pursuit of maximizing profits. Why shouldn’t a firm focus purely on maximizing profits without regard to risk? How does the management of risk play a role in the success of an organization? FIN 571 Week 1 DQ 2 What is ethics? If you follow all applicable rules and regulations, are you an ethical person? Why? FIN 571 Week 1 Individual Assignment Business Structures Watch the “Your Business Structure” and “Corporate Business Structures” videos on the Electronics Reserve Readings page. Identify the different business structures. Write a 350 to 700 word explanation of how each business structure might and might not be advantageous. Click the Assignment Files tab to submit your assignment. FIN 571 Week 1 WileyPLUS Assignment Practice Quiz FIN 571 Complete Week 2 NEW FIN 571 Week 2 DQ 1 NEW Explain what benchmarks are, describe how they are prepared, and discuss why they are important in financial statement analysis. FIN 571 Week 2 DQ 2 NEW Financial Ratios and Firm Performance FIN 571 Week 2 DQ 3 NEW The DuPont System FIN 571 Week 2 Learning Team......

Words: 1570 - Pages: 7

Finance

...Business Structure Shirley Ortez FIN 571 Kevin Suber January 8, 2016 Business Structure Introduction: Initiation into the consumer market, business owners must explore its competitive market, its contribution and determine whether it can be fruitful. Once analyzing its contribution, stablishing business structure equipped to support the company's necessities and requirements in efforts to use it as a guideline for the owner's potential business plans. In the following passage, the rewards and shortcomings of common business structures utilized in today's market. Sole Proprietorship & Partnerships: Sole-proprietorship is a business entity directed by one individual. A particular structure that benefits business owner is the low licensing fees, and the simplification of the process attract first-time business owners to implement this particular business structure. With its appealing attributes, other major factors to study are the financially liability linked to a sole proprietorship. Business's financial obligation and personal equity become one source of funds. It indicates that a sole trader is responsible for any financial obligations the business accumulates and the owner's personal finances can me liquidated to satisfy the business debt. The secondary business structure commonly used is a general partnership and limited partnership, like a sole proprietorship, general partners are equivalently responsible for a business's......

Words: 831 - Pages: 4

Fin 571 (Foundations of Corporate Finance) Full Course - New

...FIN 571 (Foundations of Corporate Finance) Full Course - NEW IF You Want To Purchase A+ Work then Click The Link Below For Instant Down Load http://www.acehomework.net/?download=fin-571-foundations-of-corporate-finance-full-course-new IF You Face Any Problem Then E Mail Us At JOHNMATE1122@GMAIL.COM FIN 571 Complete Week 1 NEW FIN 571 Week 1 DQ 1 NEW Minimizing risk is essential in the pursuit of maximizing profits. Why shouldn't a firm focus purely on maximizing profits without regard to risk? How does the management of risk play a role in the success of an organization? FIN 571 Week 1 DQ 2 What is ethics? If you follow all applicable rules and regulations, are you an ethical person? Why? FIN 571 Week 1 Individual Assignment Business Structures Watch the "Your Business Structure" and "Corporate Business Structures" videos on the Electronics Reserve Readings page. Identify the different business structures. Write a 350 to 700 word explanation of how each business structure might and might not be advantageous. Click the Assignment Files tab to submit your assignment. FIN 571 Week 1 WileyPLUS Assignment Practice Quiz FIN 571 Complete Week 2 NEW FIN 571 Week 2 DQ 1 NEW Explain what benchmarks are, describe how they are prepared, and discuss why they are important in financial statement analysis. FIN 571 Week 2 DQ 2 NEW Financial Ratios and Firm Performance FIN 571 Week 2 DQ 3 NEW The DuPont System FIN 571 Week 2 Learning Team......

Words: 1570 - Pages: 7

Fin 571 (Foundations of Corporate Finance) Full Course – New

...FIN 571 (Foundations of Corporate Finance) Full Course – NEW IF You Want To Purcahse A+ Work then Click The Link Below For Instant Down Load http://www.acehomework.net/?download=fin-571-foundations-of-corporate-finance-full-course-new IF You Face Any Problem Then E Mail Us At JOHNMATE1122@GMAIL.COM FIN 571 Complete Week 1 NEW FIN 571 Week 1 DQ 1 NEW Minimizing risk is essential in the pursuit of maximizing profits. Why shouldn’t a firm focus purely on maximizing profits without regard to risk? How does the management of risk play a role in the success of an organization? FIN 571 Week 1 DQ 2 What is ethics? If you follow all applicable rules and regulations, are you an ethical person? Why? FIN 571 Week 1 Individual Assignment Business Structures Watch the “Your Business Structure” and “Corporate Business Structures” videos on the Electronics Reserve Readings page. Identify the different business structures. Write a 350 to 700 word explanation of how each business structure might and might not be advantageous. Click the Assignment Files tab to submit your assignment. FIN 571 Week 1 WileyPLUS Assignment Practice Quiz FIN 571 Complete Week 2 NEW FIN 571 Week 2 DQ 1 NEW Explain what benchmarks are, describe how they are prepared, and discuss why they are important in financial statement analysis. FIN 571 Week 2 DQ 2 NEW Financial Ratios and Firm Performance FIN 571 Week 2 DQ 3 NEW The DuPont System FIN 571 Week 2 Learning Team......

Words: 1570 - Pages: 7

Fin 571 (Foundations of Corporate Finance) Full Course - New

...FIN 571 (Foundations of Corporate Finance) Full Course - NEW IF You Want To Purchase A+ Work then Click The Link Below For Instant Down Load http://www.acehomework.net/?download=fin-571-foundations-of-corporate-finance-full-course-new IF You Face Any Problem Then E Mail Us At JOHNMATE1122@GMAIL.COM FIN 571 Complete Week 1 NEW FIN 571 Week 1 DQ 1 NEW Minimizing risk is essential in the pursuit of maximizing profits. Why shouldn't a firm focus purely on maximizing profits without regard to risk? How does the management of risk play a role in the success of an organization? FIN 571 Week 1 DQ 2 What is ethics? If you follow all applicable rules and regulations, are you an ethical person? Why? FIN 571 Week 1 Individual Assignment Business Structures Watch the "Your Business Structure" and "Corporate Business Structures" videos on the Electronics Reserve Readings page. Identify the different business structures. Write a 350 to 700 word explanation of how each business structure might and might not be advantageous. Click the Assignment Files tab to submit your assignment. FIN 571 Week 1 WileyPLUS Assignment Practice Quiz FIN 571 Complete Week 2 NEW FIN 571 Week 2 DQ 1 NEW Explain what benchmarks are, describe how they are prepared, and discuss why they are important in financial statement analysis. FIN 571 Week 2 DQ 2 NEW Financial Ratios and Firm Performance FIN 571 Week 2 DQ 3 NEW The DuPont System FIN 571 Week 2 Learning Team......

Words: 1570 - Pages: 7