Assignment 1: DiscussionFinance Organization and Long-Term Planning Considering Genesis Energys aggressive growth plan, Sensible Essentials suggested that its client should broaden the scope of financing beyond short-term loans and consider long-term financing options. These options would greatly enhance the ability of the operations management team to fund the capital investments and growth in operating expenses. One option is selling more equity in the company. A public stock offering might be a possibility; however, a company as young and small as Genesis Energy might be hard to value. Sensible Essentials believes that another private investor might require preferred stock dividends in order to mitigate some of the financial risk. Another option is a long-term bank loan. Acting as the finance expert for Sensible Essentials, respond to the following: Determine the cost of debt and equity for Genesis Energy and its weighted average cost of capital. Go to www.yahoofinance.com and look under SEC filings. Use a US publicly traded company, such as Apple, Google, DuPont, etc. Identify the sources of long-term financing for Genesis Energy. Analyze the potential costs and benefits of each option. Explain how relative risk (from the investors perspective) impacts the cost of capital for Genesis Energy. Determine the cost of debt and equity for Genesis Energy and its weighted average cost of capital. Calculate the required rate of return for Genesis Energy using the capital asset pricing model (CAPM). What is the required return for Genesis Energy shareholders? By the due date assigned , post your response to the Discussion Area . Through the end of the module , review and comment on at least two peers responses. Write your initial response in 300500 words. Your response should be thorough and address all components of the discussion question in detail, include citations of all sources, where needed, according to the APA Style, and demonstrate accurate spelling, grammar, and punctuation Do the following when responding to your peers: Read your peers answers. Provide substantive comments by contributing new, relevant information from course readings, Web sites, or other sources; building on the remarks or questions of others; or sharing practical examples of key concepts from your professional or personal experiences Respond to feedback on your posting and provide feedback to other students on their ideas. Make sure your writing is clear, concise, and organized; demonstrates ethical scholarship in accurate representation and attribution of sources; and displays accurate spelling, grammar, and punctuation. ________________________________________________________________________________________________________________________– Assignment 2: Genesis Energy Cash Position Analysis The Genesis Energy operations management team is now preparing to implement the operating expansion plan. Previously, the firms cash position did not pose a challenge. However, the planned foreign expansion requires Genesis Energy to have a reliable source of funds for both short-term and long-term needs. One of Genesis Energys potential lenders tells the team that in order to be considered as a viable customer, Genesis Energy must prepare and submit a monthly cash budget for the current year and a monthly cash budget for the subsequent year. The lender will review the cash budget and determine whether or not Genesis Energy can meet the loan repayment terms. Genesis Energys ability to repay the loan depends not only on sales and expenses but also on how quickly the company can collect payment from customers and how well it manages its supplier terms and other operating expenses. The Genesis Energy team members agreed that being fully prepared with factual data would allow them to maximize their position as well as negotiate favorable financing terms. The Genesis Energy management team held a brainstorming session to chart a plan of action, w…
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