In Chapter 11 we are learning about Bonds Payables, which is one way for a company to raise funds. We have also known s

[answerhappygod]

In Chapter 11 we are learning about Bonds Payables, which is one
way for a company to raise funds. We have also known since
Chapter 1, that a company can raise capital by selling part of the
ownership. Pretend that you are starting a company.
Provide a short description of your company, and then explain
whether you would rather fund your growth with equity (selling
stock) or bonds. Of course, we all would want to keep 100%
ownership of our company and have no debt, but who has millions of
dollars laying around? Show your classmates that you can
deeply assess how to make a strong business decision with the
knowledge you have studied.
My company would be a chain of bookstores throughout the
company. My preference would be to grow through equity since
I do not like debt. Additionally, the constant pressure of
interest payments to my lenders would be stressful. Lastly,
if I raise funds by selling part of my company, I do not have any
guaranteed payments to investors. However, given that
bookstores are not very popular these days, I am afraid that the
likely option is that I would have to fund my company’s growth
through bonds. (I could borrow money from the bank but I have
big ambitions for my bookstores in every state and therefore would
need a lot more in loans than a bank could provide). Not many
people would want to invest in my bookstore, which is why selling
part of the ownership will be difficult. My only option will
probably be to offer bonds because at least those who lend me money
will be promised an interest payment every year. It’s not
what I would prefer, but I choose to create a bookstore chain and
those are the circumstances we live in!