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Your Friend and Former College Roommate,David,has Just Been Hired to Manage

question 14

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Your friend and former college roommate,David,has just been hired to manage a small,family-owned business because the owner has fallen ill,and none of his children are yet ready to assume leadership of the business.David has hiring and firing authority (except for the owner's children) ,and wants to expand and diversify the sales staff,by hiring women and persons of color.There are 3 openings.What would be your best advice to him to accomplish his goals?


Definitions:

Debt Financing

The method of raising capital through the sale of bonds, bills, or notes to individuals or institutions.

Interest Tax Shield

The reduction in income taxes that results from taking the interest expense as a deductible charge.

Capital Structure

The capital structure is the mix of a company's long-term debt, specific short-term debt, common equity, and preferred equity which funds its overall operations and growth.

Tax Rates

The segment of earnings an individual or corporate entity owes to the government in taxes.

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