Explain how a company can be “profit rich, yet cash poor.”
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Explain how a company can be “profit rich, yet cash poor.”
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- How to incease profitability in a service company if Operating cash does not cover debt?Why is it that the goal of financial management is maximization of shareholders’ wealth rather than maximization of profit?How can changes in working capital affect a company's cash flows, and how can this be managed effectively?
- what is financial leverage and its implications for company performance?What factors contribute to the business risk of a company? What is financial risk? How do the various sources of risk affect the optimal capital structure?Analyze the company’s strengths and weaknesses in terms of liquidity, solvency and profitability.