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(Solved): Ishika after acquiring a degree in Hotel management and BusinessAdministration, Took over her family ...



Ishika after acquiring a degree in Hotel management and BusinessAdministration, Took over her family food accession Company ofManufacturing pickles, Jams and squashes. The business had beenestablished by her great grandmother and was doing reasonably well.However, the fixed operating costs of the business were high and thecash flow position was weak. She wanted to undertake modernisation ofthe existing business to introduce the latest manufacturing processes anddiversify in to the market of chocolates and candies. She was veryenthusiastic and approached to a financial consultant who told her thatopproximately Rs. 50 lakh would be required for undertaking themodernisation and expansion programme. He also informed hir that thestock market was going through a bullish phase.i) Keeping in mind. the above considerations, indentify the source offinance that should not be chosen by Ichila for financing the mod-ernization and expression of her food processing business. Giveone reason in support of your answer.ii) Explain any two factors, a part from those stated in the above situa-tion, which she should keep in mind while taking this decision.



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