Essay on Finance Case

Words: 990
Pages: 4

Executive Summary In the case GE Capital Canada, Clark Carriers submitted a request for a loan of $270000. It was confirmed first that Clark Carriers met the minimum requirements set out by the commercial equipment financing division of GE for loans. Cash flow was analyzed to ensure that Clark Carriers had sufficient cash flow from operations to make payments on current loans. The projected financial statements of 2003 were created and analyzed to include the new potential loan to display how the new equipment and contract would benefit Clark Carriers’ financial position. Then the financial ratios were analyzed to ensure that Clark Carriers was in fact efficient in its profitability, liquidity, stability, efficiency and growth in which …show more content…
They are also slowly growing so it will make it an ideal place to give a loan.

Alternative Analysis Some of the alternatives for the company is that they take out a loan somewhere else which would be lost business for GE Capital Canada. If Clark Carriers takes its business elsewhere they could be losing a really good client. Another alternative could be for Clark Carriers to try and make the money on its own to buy the trucks but at the pace they are going it will take them a really long time to do so. Clark Carriers can also not invest in new trucks but this will not advance the company and keep them at a standstill. After a while of not advancing they will start losing money and will eventually need to take out a loan. It is better for them to take out a loan now then to do it later on so that they can start success now rather than later. With some of the competition that could soon be forming it would be ideal for them to do that. If the loan is not approved then the company will be saving money and not have to give out the $270000 that Clark Carriers is asking for. On the other hand Clark Carriers would not have to worry about debt and what they would need to owe when the time comes.

Decision/Recommendation It is recommended that GE Capital Canada does approve the loan because it would be a smart decision to do because Clark Carriers is on the up and up and will make a lot of money so they will have nothing to lose. This loan