New York Empire State Development $50 million Loan Program Accepting Applications Until Sept. 30th

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New York State’s Empire State Development  is accepting applications for its $50 million small business revolving loan fund until September 30th.  The fund was conceived and approved to create economic activity by providing greater access to capital for small businesses.

Small retail, service and manufacturing businesses across New York State are eligible to apply.    The intention is for loan proceeds to lead to the creation and retention of jobs.  An overview of the revolving loan program,  a copy of the RFP form and contacts for further information are all now posted on the Empire State Development website.

Introductory Finance for Business

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I am scheduled to teach Introductory Finance for Business at The New School 4pm Mondays, starting 8/30/10. The course provides an understanding of financial statements and concepts for students with no prior knowledge of the subject and is enlivened by excerpts from TV and Movies that deal with business finance. We need just a few more students for the course to be a “go”.   (9/27 update:  We got the needed students, and just had our fourth class this evening)

For more details, please click here, and then click on “business and management”, and then click on course NMGT 2133. Please help me pass the word, the course is open to the general public, thanks!

Here are five questions from a practice exam I gave to my students in a prior year; how many of these can you solve?

1. If a company with $3 million annual revenue decreases its accounts receivables from 45 days outstanding to 30 days outstanding how much cash is freed up?

2. An investor buys a 30-year, 10% interest bond, for $100,000. If interest rates increase to 20%, the value of this bond would change to:
a. $50,211
b. $91,667
c. $104,762
d. $176,862

3. Which of the following statements distinguishing debt versus equity is true?

a. Debt is an ownership interest, while equity is not
b. A publicly-owned firm’s equity has a fluctuating market price, not its debt
c. An all-debt firm is more likely to go bankrupt than an all-equity firm
d. Companies must have some debt in place before they can sell equity

4. A firm has operating income of $50 million, interest expense of $18 million, dividends paid of $15 million, and a 40% tax rate, what is net income?
a. $10.2 million
b. $12.8 million
c. $19.2 million
d. $21.0 million

5. A premium bond has a coupon rate that:
a. is less than the yield to maturity.
b. equals zero.
c. must be variable.
d. equals the current yield.
e. exceeds the yield to maturity

ANSWERS: 1. $123,288, 2A, 3C, 4C, 5E

NY State Creates $50 Million Loan Fund to Aid Small Businesses

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New York State has put up $25 million, which when matched by private lending institutions, will create a $50 million loan fund intended to aid NY State small businesses blocked from access to traditional sources of credit, the 7/19/10 “Westchester County Business Journal” reported.  Successful applicants may use the funding for “working capital, acquisition and or improvement of real property, the acquisition of machinery and equipment, property improvement, or the refinancing of debt obligations.”  Business owners seeking more information on the program are encouraged to contact their regional Empire State Development office.

(8/26/10 update:  The “Brooklyn Daily Eagle” reported that the Empire State Development Corp. awarded Brooklyn Brewery an $800,000 “restore New York” grant, which will help the brewer expand their Williamsburg operations, by purchasing and installing new equipment.)

Karen Gordon Mills is new SBA Administrator

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Karen Gordon Mills, confirmed earlier this month as the new SBA Administrator, has a unique set of qualifications for the position: Baker Scholar at Harvard Business School, General Foods product manager, McKinsey consultant, Chair of the Council on Competitiveness and the Economy for the state of Maine, and co-author of a Brookings Institute paper on the importance of industrial clusters in bolstering U.S. competitiveness. According to the Institute for Strategy and Competitiveness, “clusters are geographic concentrations of interconnected companies, specialized suppliers, service providers, and associated institutions in a particular field that are present in a nation or region. Clusters arise because they increase the productivity with which companies can compete.”

Trade Credit Insurance is a Valuable Tool for Small Businesses

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Trade Credit Insurance can be a valuable tool for small business owners who are worried about financially strapped customers who may default, leaving them stuck with large unpaid invoices. (According to Automated Access to Court Electronic Records, or AACER, 20,521 businesses sought either Chapter 7 or Chapter 11 protection in the first quarter of 2009, a 52% increase over the same period in 2008.) A business can purchase trade credit insurance for a single customer, or as a blanket policy, “Business Week Small Biz” recently reported.