Essay Objective: Describe the sources of capital available to firms and estimate the cost for various sources.

Introduction: Financial planning is about developing strategies to help you manage your financial affairs and meet your life goals. Business financial planning determines how a business will afford to achieve its strategic goals and objectives that are aligned to the mission and vision.

Deliverables: 3-page essay.  A minimum of 3 full pages (exclusive of title and reference pages) is required.

Activity Details:

Step 1: Introduction

Begin with an introductory paragraph that describes what business financial planning is and why it important.

Step 2: Research and Write Essay Content

Consider the following scenario: you and your two new partners have to get through the financial planning process. They have no financial management knowledge and are confused by some of the terminology. Since most of the funding for the startup was done via capital funding, it is important that your partners understand these terms and how they can work towards the growth of the business. There are specific questions that need to be answered:

What is the difference between the coupon rate and the current market interest rate of a bond?

What is the difference between a mutual fund and a mutual fund family?

What is the difference between a preferred stock dividend and a common stock dividend, if any?

Describe and explain to the reader what the above financial planning items are and answer the questions.

Step 3: Conclusion Summary
For the conclusion paragraph summarize what you have learned about possible business financial planning and share your thoughts about business financial planning.

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References
Financial Statement Analysis For Small Businesses from the Virginia Small Business Development Center (2011) Florida Small Business Development Center Network Florida SBDC Network grants permission for use and modification of this manual to the Virginia SBDC July 16, 2008.