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Important Ratios for Investors and Lenders

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Important Ratios for Investors and Lenders 3-4 pages not including cover page and reference page. Refer to Target Corporation’s financial statements (http://investors.target.com/phoenix.zhtml?p=irol-irhome&ref=nav%5Ffooter%5Finvestors&c=65828) . Target Corporation is currently seeking additional capital to expand its operations. Two companies have shown interest in providing additional capital. • Company #1 is interested in investing in the organization and, therefore, would like to have part ownership through the sale of new stock. • Company #2 is interested in providing a loan to the Target Corporation. Both organizations need to know more about the financial stability of Target. As an employee of Target, your supervisor needs you to write a memo in which you explain what information from the Target Corporation’s financial statements will be highlighted when representatives of Target meet with each of these companies. In your memo, be sure to explain which information will be highlighted to Company #1 and which information will be highlighted to Company #2 and why. Explain any differences in the information that you have chosen to highlight. Instructor Comments: Companies have two ways to finance their growth: equity financing or debt financing. In equity financing the company is selling stock to generate cash. Debt financing is borrowing money. Is there a difference in the information that a lender and an investor would want? Think back to the financial statements and some of the ratios that you learned about in the previous chapters (remember back to unit 1 Sam and Melinda), which would be of interest to the lender and which would be of interest to the investor. What about the statement of cash flows, would this be useful? Explain any differences in the information that you have chosen to highlight and offer reasons why lenders and investors need specific information. The correct link for Target Corporation’s financial statements http://investors.target.com/phoenix.zhtml?p=irol-irhome&ref=nav%5Ffooter%5Finvestors&c=65828 and then click on annual reports. No direct quotations are allowed on this assignment. In text citations and a reference list is a must. Objective: Identify the various user groups which need accounting information and the characteristics of the information that they need. Business Management Assignment Help, Business Management Homework help, Business Management Study Help, Business Management Course Help

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