Assignment 6 BGaspard

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School

Scott High School *

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Course

101

Subject

Finance

Date

May 1, 2024

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pdf

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2

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Assignment 6 BGaspard (20 points) Assignment 6: Business Finance Instructions Save this file in your course folder, and name it with Assignment, the section number, and your first initial and last name. For example, Jessie Robinson's assignment for Section 1 would be named Assignment1JRobinson. Type the answers to the assignment questions below. Use complete sentences unless the question says otherwise. You will have more than one day to complete an assignment. At the end of each day, be sure to save your progress. Review Lesson 4 of the Course Overview for instructions about turning in your assignments. Assignment Questions In Section 6, you learned about business finance. Now, you'll apply what you learned. 1. For this assignment, choose a type of company that you could imagine yourself starting. Describe the type of company. (1-4 sentences. 1.0 points) I could imagine myself starting a technology start up that would focus on developing mobile applications. The application would cater to the increasing demand for mobile solutions across various industries by creating innovative apps for productivity, entertainment, education, or other activities. 2. Describe at least two sources you would use for funding your company. (1-2 sentences. 2.0 points) Two sources I would consider for funding my company are venture capital firms and loans from the bank. Venture capital firms can provide substantial funding in exchange for equity, while a loan from the bank could fund my project, and I would pay the bank back over a period of time. 3. Would you rather fund your company using mostly debt funding, or mostly equity funding? Why? (1-5 sentences. 3.0 points) I would most likely fund my company mostly through equity funding. Equity funding involves selling a portion of ownership in the company in exchange for capital. This method can help reduce the financial burden of debt repayment, especially in the early stages of a startup when cash flow may be limited. This would make me feel safer in the business 4. Make a list of at least 3 startup costs this company would have. (Complete sentences are not necessary. 3.0 points) app development and design marketing/ advertising campaigns Equipment office space employee salaries Legal fees Insurance 5. Will your company use cash-basis or accrual-basis accounting? Explain why. (1-3 sentences. 2.0 points)
For my company I would use accrual basis accounting. This type of accounting recognizes revenue when it is earned and expenses when they are used. providing a more accurate representation of the company's financial position and performance over time. 6. Will you use single-entry bookkeeping or double-entry bookkeeping? Explain why. (1-3 sentences. 3.0 points) I would choose double-entry bookkeeping for my company. This is because it provides a more accurate representation of financial transactions by recording both the debit and credit sides of each transaction. I feel like using double-entry bookkeeping helps identify errors, tracking financial performance, and ensuring accurate financial reporting. 7. List at least 3 risks your company will face, and explain how you will manage those risks. (1-6 sentences. 6.0 points) Risks my company may face include technological changes impacting app relevance, competition from established companies, and cybersecurity threats. To manage these risks, I would focus on continuous innovation and market research to stay ahead, build strong branding and customer loyalty, invest in good cybersecurity measures, and have contingency plans in place for potential disruptions. Money might be a risk as well. If my business doest take off i would risk going into debt and having no revenue to repay the bank who gave me a loan.
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