Financial Assets Of A Business Organization

Debt capital: borrowing someone else’s money to finance the business under the condition that the money plus accrued interest must be paid back in full by an agreed upon date in the future

The statement of cash flows explains the change during the period in cash and cash equivalents. Cash includes currency on hand and demand deposits. Cash equivalents are short-term, highly liquid investments that are readily convertible to cash (Flight. 2006). Because of this there are two recommendations for Tyva.

“Individuals and businesses lend their savings to borrowers. In exchange, borrowers give lenders a debt instrument, which is called bonds, representing a promise by borrowers to pay interest income to lenders on the principal (the amount of money borrowed) until the principal is repaid to the lenders” (Feldstein & Fabozzi, 2011).

Note: To make the balance sheet balance, define cash as equal to (Current liabilities + Net worth) – (Accounts receivable + Inventory + Other current assets + Net fixed assets).

34. What does it include as Cash and Cash Equivalents? – Cash and cash equivalents include cash and short-term highly liquid investments with an original maturity of three months or less held in both domestic and foreign financial institutions.

4. Financial assets are receivables between companies where they both agree with the contractual rights that they will receive cash or other financial assets (Donald Kieso).

Finance assets or the financial worth the assets, such as cash. The factory, machine, and tools owned by a firm and used for process and production.

b) Why does a business that has profit $30,000 per year need a bank loan?

Note 3 touches on the category of cash and cash equivalents. Some of the cash equivalents are "available for sale securities." These include agency obligations ($20 million), commercial paper ($87 million), corporate debt securities ($78 million), government treasury securities ($606 million) and certificates of deposit ($64 million). In addition, the balance sheet shows $1.1886 billion in cash. There are stated at fair market value, which if it cannot be determined on the open market is estimated. The company values auction rate securities using an internally-developed valuation model. The company also notes that some of the "available for sale" securities are longer-term in

debt. The steady cash flow generated by the business, short-term bank loans, and the proceeds of the

Sources of finance refers to the ways of gathering various financial sources to meet the financial needs of the business. Furthermore, it states exactly how the companies are gathering and allocating finance to satisfy the requirements of the firm (Chandra, 2011). Firm either belong to existing or new categories that would need a varied amount of finance to meet the long and short term requirements such as construction, inventory, fixed assets and operating expenses (Hally, 2007).

The first resources that the company own is the financial resources. Financial resources are the ability of the company to borrow or the ability to generate funds through operations of the company. For Rio Tinto, the company has done several ways to improve the financial resources. Referring to the Annual Report of 2016, the Chief Executive of Rio Tinto,J.S Jacques said that the company has generated net cash

In the business world companies are always trying to maximize their earning potential by strategically investing in short-term financing. In terms of finance short-term may mean months or even a couple of years. The type of finance method that is used is contingent on the specific needs of the corporation. These methods include trade credit, bank credit, financing through commercial paper, foreign borrowing, and the use of collateral, accounts receivable financing, inventory financing and hedging to reduce borrowing risk.

group of people or an individual who are in collaboration to achieve given commercial goals is known as a business organisation. Companies may have information with a purpose or aim of making profits while others start on non-profit making basis. The way the way the business ' organisation operates depends on the profit or non-profit making basis. However, the basics and the fundamentals of the companies are in one way or the other, similar since the management functions of the organizations are often similar. This report will focus on a profit-making organisation known as Aldi. The main points of discussion will lean towards the fundamentals of the organisation; that will cut across the background, financial performance and the marketing strategies that they have adopted in their quest to attract a huge customer base.

Capital: The bank needs to know what assets the organization owns that can be quickly turned into cash.