Even though profits may be strong and the balance sheet solid, some say cash is still the "lifeblood" of a company? What does this refer to and whose responsibility is cash management?
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Even though profits may be strong and the balance sheet solid, some say cash is still the "lifeblood" of a company? What does this refer to and whose responsibility is cash management?
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- Which of the following is not typically a characteristic experienced by a company during the introductory phase of the corporate life cycle? Cash from financing is positive. Cash used in operations will exceed cash generated by operations. Considerable cash will be used to purchase productive assets. Cash from investing is positive.Accounting statements represent a company’s earnings, but this is not the real cash that a company generates. Earnings data can be manipulated and can be deceiving. Thus, corporate decision makers and security analysts focus on the free cash flow that a firm generates to analyze the company’s real cash position. Which of the following statements best describes free cash flow? The excess cash generated by revenues less all operating expenses Based on your evaluation you have (103,379,107,069,111,989,152,579) in free cash flow. Can a company have negative free cash flow? No Yes The cash flow available for distribution to all investors after the company has made all investments in fixed assets and working capital necessary to sustain a firm’s ongoing operations Suppose you are the only owner of a chain of coffee shops near universities. Your current cafés are doing well, but you are interested in starting a fine-dining restaurant. You…Is it possible for a company to show positive cash flows and still be in grave trouble?
- As long as a firm maintains a positive cash balance, why is it essential to review the firm's cash flows?Is it possible that a company with a very high net income has a negative balance of cash flows from operating activities? Explain your answer. please answer in detailWhat are the key reasons for financial managers to maintain cash reserves? How much or how little cash should be held on hand for the operations of a business?
- as long aa a firm maintain a positive cash balance why is it essential to review the firms cash flow?. Free cash flow Accounting statements represent a company’s earnings, but this is not the real cash that a company generates. Earnings data can be manipulated and can be deceiving. Thus, corporate decision makers and security analysts focus on the free cash flow that a firm generates to analyze the company’s real cash position. Which of the following statements best describes free cash flow? Residual cash flow after taking into account operating cash flows, including fixed-asset acquisitions, asset sales, and working-capital expenditures Cash flows generated by operating the business Suppose you are the only owner of a chain of coffee shops near universities. Your current cafés are doing well, but you are interested in starting a fine-dining restaurant. You decide to use the cash generated from your existing business to enter into a new business. Your accountant provides you with the following data on your current financial performance: Financial update…Assume you are the financial officer of a major firm. The president of the firm has just stated that she wishes to reduce the firm's investment in current assets since those assets provide little, if any, return to the firm. How would you respond to this statement? As long as a firm maintains a positive cash balance, why is it essential to review the firm's cash flows
- Operating cycles and cash cycles are two short-term areas a financial manager must keep track of in managing a business. How are the operating and cash cycles of the firm different? Why are they important?Answer the following questions for the directors: True or false, does the statement of cash flows explains the difference between net income and the change in the cash balance? True or false, investors and management use the statement of cash flows to evaluate a firm's profitability? True or false, the financing activities section of the statement of cash flows includes paying dividends and paying off loans? True or false, the financing activities section of the statement of cash flows reflects the cash flows that affect current assets and liabilities? True or false, buying property, plant and equipment would be considered a cash outflow from financing? True or false, the financing section of the statement of cash flows reflects transactions in the equity accounts and the long-term liability accounts? True or false, suppose Auga Company Ltd just started business and was looking for additional capital in order to purchase a property to build their headquarters. If they found an…Answer the following questions for the directors: True or false, does the statement of cash flows explains the difference between net income and the change in the cash balance? True or false, investors and management use the statement of cash flows to evaluate a firm's profitability? True or false, the financing activities section of the statement of cash flows includes paying dividends and paying off loans? True or false, the financing activities section of the statement of cash flows reflects the cash flows that affect current assets and liabilities? True or false, buying property, plant and equipment would be considered a cash outflow from financing? True or false, the financing section of the statement of cash flows reflects transactions in the equity accounts and the long-term liability accounts? True or false, suppose Auga Company Ltd just started business and was looking for additional capital in order to purchase a property to build their headquarters. If they found an…
