Complete a 1 – 2 page paper briefly outlining the different methods of funding a


Complete a 1 – 2 page paper briefly outlining the different methods of funding a business or capital project project.
Part 1 – Equity versus Debt. As you will recall from the balance sheet formula assets = liability + equity. Even if purchasing a new asset or investment opportunity for the company is done with cash, that cash (asset) is available because the owners have equity balances or because there was a loan / debt drawing cash funds in. Thus, there are essentially two funding sources of debt or equity. Each has different forms, example debt could be bonds or a bank loan. Equity could be accumulated cash or sell of additional stock. Identify the costs and opportunity cost of each option and how each choice affects the financial performance of an organization. Be specific, what is the actual cost of each and what ratios and performance measures are impacted by each.
Part 2 – Identify three common methods (measurements) for evaluating capital funding options. Evaluate the three measurements most widely used to evaluate cost and return. Note which one is considered the most effective tool.
Paper should be in APA format with in-text citations. Similar to the case study, omit first person and personal opinion. Communicate these options to an assumed reader who is unfamiliar with finance. See writing resources in content section.


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