Science homework help

When making investment decisions that involve fixed assets, we need to examine the purchase of capital – the long-term, fixed assets that are used in production. In capital budgeting we focus on these purchases and, specifically, analyze them to decide which purchases should be made. More precisely, capital budgeting (also known as capital investment appraisal) is the process of evaluating, comparing, and selecting capital projects to achieve the best return on investment over time.
Short-Term Financial Management refers to financing needs for a small period normally less than a year. In businesses, it is also known as working capital financing. This type of financing is normally needed because of uneven flow of cash into the business, the seasonal pattern of business, etc. In most cases, it is used to finance all types of inventory, accounts receivables etc. At times, only specific one time orders of business are financed.
Inventory management refers to the process of ordering, storing, and using a company’s inventory. These include the management of raw materials, components, and finished products, as well as warehousing and processing such items.
Production Management refers to the application of management principles to the production function in a factory. In other words, production management involves application of planning, organizing, directing and controlling the production process.
 
Discussion, no more than 300 words
The increasing volatility in the global economy has caused investors to seek out safer investments alternatives. Risk is inevitable in all investments.  A capital budget is used to help investors plan their investments in long-term assets.  Discuss how risk impacts a capital budget.  How can risks be mitigated in order to attract capital investors to a sports project?
 
 
 
Respond to Paul 125 words
Capital budgets generally do not cover day to day activities; capital budgets concentrate on debts and investments (BRAYLEY & McLean, 2019, p. 223). In sports, debts or investments usually are related to the purchase of a sports franchise or the building of a stadium to host the club. Risks relating to capital budgets can come in many shapes and forms. In regards to a sports franchise, risks can come in the form of local politics, players (Injury, performance on and off the field, and legal issues), team management, and most recently, pandemics (Kioko & Marlow, 2017, Dewhirst, 2018, Richard, 2020, & Sports Facility Financing, n.d.).
Almost all investments involve risks; knowing what risks pose to the business and establishing hedges that mitigate risks can be the difference between success and failure. Risk creates uncertainty. Risks relating to capital budgeting can include economic and market conditions, taxes, and interest rates (Sports Facility Financing Video, n.d.). Sports Franchise owners mitigate risks in a variety of ways. First off, the success of the major sporting leagues in the United States would lead one to believe that sports franchises are a safe investment. According to Forbes, no National Football League (NFL) team lost money in 2019; 31 one out of 32 teams profited, while the Cincinnati Bengals broke even (Sports Money, 2020).
While the NFL is experiencing great success, there are no doubt risks involved. To mitigate risks, owners of teams are taking more control of their organizations. This is accomplished by providing more private funding. When owners put more of their own money in the team, this leads to more control and more profit (Sports Facility Financing, n.d.). Other risk mitigation factors include ensuring player’s contracts hedge against injury, performance, and off filed behavior. Earlier this year, the Baltimore Ravens released Pro Bowl Safety Earl Thomas after he was involved in a fight (Ginsburg, 2020). Another risk presented to the NFL recently was the National Anthem kneeling controversy. To deal with the moral dilemma, the NFL implemented a policy that gave players the option to remain on the field standing during the anthem or remain in the locker room (Dewhirst, 2018). The NFL is currently dealing with a once in a century risk of the Covid-19 pandemic. To mitigate risks related to the Covid Virus, the NFL has implemented several measures to protect players, coaches, staff, and fans (Richard, 2020).
Lastly, as Dr. Fuller presented us, sports players’ dilemma busting as a risk to sports franchises. Let me introduce to you one of the major disappointments ever to step on the hallowed grounds of Yankee Stadium. Jacoby Ellsbury was a star performing player for the Boston Redsox, but he was a significant disappointment for the NY Yankees (Krosnowski, 2019). Yankees fans are still grumbling about that decision.
Investments come with risk, but sports franchises are a unique investment. Not only do they provide an excellent return on investment, they also serve as a status symbol. Billionaires can purchase elegant mansions, mega-yachts, and even islands, but there are only 32 NFL franchises. Nothing shouts status more than owning a sports franchise. As long as this crown jewel of a purchase remains in play, people will risk sports club ownership.
 
 
Respond to wayne 125 words or less
 
Capital budgets are generally used for a specific project to show investors what the money is going to be used for. Given the current state of the world, there is more and more focused placed on the risks associated with investing. Unfortunately, there are many risks out there that are unforeseeable, such as the current pandemic we are facing. No one could have seen this pandemic coming and ultimately, it has halted and or stopped many different projects around the world.
One project in the fitness/sports industry is a gym being built in Texas by Youtuber Christian Guzman. If you are not familiar with Mr. Guzman, he found success while filming his fitness journey from a 115lb high school kid, to a trophy winning physique competitor (Nuno, 2020). Along the way he started multiple successful companies to include Alphalete which is a fitness clothing company and gym, as well as 3D an energy drink (Musclewealth, 2020). The success in these companies has given Mr. Guzman a net worth north of $3 million according to most sites. Given everything he has accomplished Mr. Guzman decided to launch his largest endeavor, Alphaland, just before COVID. This new project is a massive compound which will house 3 gyms, a hotel, his Alphalete headquarters and many other fitness related companies. In order to do this Mr. Guzman pulled resources (investors and loans), to make the dream a reality (Musclewealth, 2020). Obviously, the outbreak of COVID almost put a complete end to the journey before it ever got off the ground. Luckily, Mr. Guzman has been able to work with tight COVID precautions to continue to build the empire he has dreamt of. Given the fact that investors are looking for a return on investment, he had to find a way to mitigate the risks that their money would go to waste.
There are a few ways that risk can be mitigated in order to attract capital investors to a sports project. In the example I gave above, it would have been hard to use these methods without being able to forecast this event. There are other risks which are more standard that the following methods can be used for. One method would be risk premium. This method is basically where you are able to produce returns higher than less risky investments (Adams, 2020). A better return may entice a person to be willing to buy the risk. Another method would be to have an established payback period which makes the investor feel more comfortable (Adams, 2020). In a constant state of flex, like we currently find ourselves in, it becomes increasingly important to build in contingency funds when doing a capital budget. It is impossible to plan for every little speedbump along the way, but a little bit of planning can prevent larger issues later. There is no way to buy the risk of an investment down to zero, but you have to find a way to make investors feel comfortable risking their money.
 
 
Meier, H., Christofides, N., & Salkin, G. (2001). Capital budgeting under uncertainty – an integrated approach using contingent claims analysis and integer programming. Operations Research, 49(2), 196-206. Retrieved from https://search-proquest-com.ezproxy2.apus.edu/docview/219183137?accountid=8289
 
The following information are excerpts and images from two prominent sport finance textbooks:
· G. Fried, T. DeSchriver, and M. Mondello (2013). Sport Finance (3rd edition). Champaign, IL: Human Kinetics.
· Brown, M.T., Rascher, D.A., Nagel, M.S., McEvoy, C.D. (2015). Financial management in the sport industry (2nd edition). Scottsdale, AZ: Holcomb Hathaway.
Capital Budgets
“Capital budgeting focuses on major future expenses and how to finance them. For example, if a team wants to build a stadium, it will need to show how much money will be required, from what sources (bonds, cash, government financing, etc.), and how revenue will be generated to help pay for the stadium. A  capital budget can utilize tools such as the payback rule or the accounting rate of return for a project… (Capital budgeting is) the process of creating a budget specifically developed for large investment such as building a new factory or stadium where the financial plan might take years.”
“Capital expenditures are long-term expenditures amortized over a period of time… Examples of capital expenditures in sport include the purchase of a new artificial turf field for a football stadium, the purchase of a new ice resurfacer for a hockey rink, the building of a new community swimming pool, the installation of a climbing wall in a health club or college recreational center, and the construction of a stadium or arena. These expenditures require a large amount of cash, debt, and other resources that will be committed over a long period of time… Capital budgeting offers several benefits. First, a capital budget helps management plan the amount and timing of resources that will be needed… A capital budget is also helpful in evaluating alterna-tive capital expenditures. Should FieldTurf, AstroPlay, or a natural grass field be installed? The development of a capital budget will include an evaluation of these alternatives to determine which best utilizes the organization’s resources.”