As the Controller of Abc Company Essay

2084 WordsApr 5, 20139 Pages
Running Head: FINAL As the Controller of ABC Company Johnnisha Burton ACC 206 Principles of Accounting II Anton Narinskiy January 21, 2013 Purpose of the Paper This report’s purpose is to be of assistance to the CEO of ABC Company to determine if the new project should be put into action and the way that it can be within the means financially through presenting information regarding the projected costs and returns. This decision-making report is intended to aid the CEO’s in internal decisions that are made. It depicts the capability of the projects possibility of making money for the company and its intentional purpose. Methodology…show more content…
Through the calculations it shows that ABC Company made cash flow from their operations totally about $27,000 in year 19X2, the income after tax that was reported was $12,000. The cash flow statement further points out that ABC Company utilized more cash within investing activities and financing activities as opposed to the cash inflows provided through those resources. The net cash flows were in the black for the ABC Company, which was $14,000. Net income appears to be the key basis of their cash flow; the company utilized the cash flow from operating activities for investments in equipment and payment of dividends. (Shown in appendix 1) Improvement of cash flow: For the ABC Company to have more cash flows enhanced, they could expand their investments in other companies’ securities of debts to make additional cash profits. The ABC Company could provide more common stock to accumulate money to invest in additional money-making areas or to include added production activities through increasing the manufacturing activities. Project financing: Despite the new project not having to invest in capital equipment for set amount; it is clear that due to the present amount of cash flow for the

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