Question

Frank is going to pursue additional financing from the local bank. The bank will require some insight into how Frank's business will be successful and sustainable.

Prepare a short write up (approximately 1 page) explaining to the bank why your (Frank's) business will be viable. Submission could include (but are not limited to) location, time of year, target consumer, pricing, anticipated sales volume, and what makes your hot dogs special.

Your write-up should ask for an amount of cash from the bank that covers the assets you could not buy, as listed in the prompt (and remember there was a $50K equity infusion already), and should give some buffer for some additional cash to keep on hand.

Prepare DRAFT estimated financial statements for the bank to consider.  

The financial statements are going to be basic and will build on your fundamental knowledge from the first three chapters of the book. You will provide

1. A balance sheet that includes the assets discussed in the announcement only, as well as equity (the amount invested which there are no plans to repay - from the announcement), and the liabilities (amounts expected to be repaid in cash to the bank). While we're not that far into debt/equity, the primary difference is whether the Company is expected to repay in cash.

You can use the discussion as finalized in the announcement for the assets, liabilities, and equity you will expect to see on the balance sheet. The write up to the bank should be professional and request an amount of money which is sensible based upon the needs of the business, with some cash buffer to have cash on hand. Please see earlier discussions and announcements.

Answer 1

I take night classes at a university so I can make myself available for my target consumer - the ever-hungry university student . These students are voracious hot dog connoisseurs and are looking for the next level of pork perfection. This is where my business stands out. I will provide a high quality, low cost weenie that will leave the consumers satisfied. For less than $5, I will give the taste buds of my customers an experience to remember and leave them clamoring for the next connection with my carnivore's dream. That is not all, I have also secured a vendor partnership with a local tofu-doggery where I can provide the means to satiate the appetite of the vegan population as well. My cart is earth conscious and is powered by recycled hot dog leftovers. This new composting technology, coined "dog-posting" also creates an aroma of hot dog deliciousness which will draw the crowds from afar."