Mini case study - Executive Fruit Financial planning model

This paper concentrates on the primary theme of Mini case study - Executive Fruit Financial planning model in which you have to explain and evaluate its intricate aspects in detail. In addition to this, this paper has been reviewed and purchased by most of the students hence; it has been rated 4.8 points on the scale of 5 points. Besides, the price of this paper starts from £ 79. For more details and full access to the paper, please refer to the site.

Mini case study - Executive Fruit Financial planning model

George Hedderwick spent his morning developing a financial planning model for Executive Fruit (see Figure 18-2). Now he needed to run out the projections to 2007. In particular, he wanted to check what would happen if the firm continued to expand at 10 percent and relied on new issues of debt to make up any required external financing. Would the standard measures of leverage, such as the debt ratio and the interest cover start to spin out of control? Executive Fruit`s bank had stipulated that the company`s debt ratio should not exceed 60 percent, and George wanted to see whether there was any risk that this condition would be breached. It might be OK if interest rates stayed at their current level, but it looked as if the Fed could raise rates in the near future. George decided that he would also develop some projections assuming that the interest rate increased from 10 percent to 15 percent.

Although the CEO appeared reluctant to raise new equity, George thought he would take the opportunity to explore other financial strategies. In particular, he was interested to see how things might look if Executive Fruit kept to a constant 40 percent debt ratio. The return on equity might not look so good in this case, but it would certainly keep the company`s bankers happy.

1. Determine what type and amount of financing may be required, taking into account the impact on leverage ratios

2. Determine the impact of rising interest rates on future performance

100% Plagiarism Free & Custom Written,
Tailored to your instructions

International House, 12 Constance Street, London, United Kingdom,
E16 2DQ

UK Registered Company # 11483120

100% Pass Guarantee

Order Now


We've produced some samples of what you can expect from our Academic Writing Service - these are created by our writers to show you the kind of high-quality work you'll receive. Take a look for yourself!

View Our Samples

FLAT 50% OFF ON EVERY ORDER.Use "FLAT50" as your promo code during checkout