Question 1:
Oman Constructions is a leading construction company in Muscat. The company is planning to start a mega shopping mall with state of the art facilities. Estimated cost for this project is RO. 50 million. Additionally they would need a working capital of RO. 10 million for the first 10 years. The company is asking you to give suggestions for raising the finance.
You are requested to suggest any two sources each in both long term and short term sources of finance. Explain the benefits and limitations for all your suggestions.
Question 2:
Salalha plastics is a plastic products manufacturing company. Their annual revenue is close to RO. 400,000. They have expanded their products aggressively in the last one year. They have added many new customers in the last year. The company is facing some problems with their receivables management. The company has hired you as their consultant.
You are requested to advice the company on the following,
a. What should be the objectives of receivables management for the company?
b. Which type of credit policy should the company follow?
c. What are credit variables should the company consider while finalizing their credit policy?