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2 years ago

Why is looking at cash flow an important step in a good financial plan?

2 answers:

Colt1911 [192]2 years ago

8 0

Cash is the most liquid form of assets. Meaning that it can be easily traded with other resources within short a period of time.

Because of this, better cash flows usually provide financial planners with more flexibility in determining the actions that they need to take. Not only that, high amount of cash inflows indicates that there is a high volume transaction between the company and the consumers. This usually seen as favorable by investors.

stellarik [79]2 years ago

3 0

Looking at cash flow is an important step in a good financial plan because it can help you determine places where you need to scale back on spending.

You might be interested in

The value of an investment increases by 0.05 % each day. by what percent does it increase in a year?

iVinArrow [24]

18.25%

0.05% x 365 (days in a year)

5 0

2 years ago

An account becomes uncollectible a.when an account receivable is converted into a note receivable b.There is no general rule for

vovangra [49]

Answer:

The correct answer is letter "B": There is no general rule for when an account becomes uncollectible.

Explanation:

Accounts Uncollectible represent any form of debt as a result of sales on credit that are likely not to be paid. Before classifying debt as uncollectible there is an unset timeframe that may go by.

At first, the sale on credit is considered an account receivable with a payment promise usually of 30 or 90 days. If three month passes but no payment is received, the account is considered aged receivables but if more time goes through without payment, the account then is labeled as doubtful.

Doubtful accounts become allowances if the company decides to take care of the payment of the debt with its own profit. <em>There is no set rule when an account receivable becomes uncollectible. It relies on the judgment of the firm.</em>

8 0

2 years ago

Weightman Corporation's net operating income in Year 2 was $76,385, net income before taxes was $55,385, and the net income was

muminat

Answer:

11.00

Explanation:

$Earnings \: per \: share = \frac{net \: income}{shares}$

36,000 net income

200,000 common stock / $4 per share= 50,000 shares

36,000 / 50,000 = 0.72 earnings per share

$price-earnings \: ratio = \frac{market\: price}{EPS}$

7.92 / 0.72 = 11

5 0

2 years ago

The owner of Chips etc. produces two kinds of chips: lime (L) and vinegar (V). He has a limited amount of the three ingredients

Sloan [31]

Answer:

Objective function (maximize)

$Profit=0.40L+0.50V$

Constraints

- Availabitily of salt: $2L+3V\leq4800$

- Availability of herbs: $1C+2V\leq 2000$

- Availability of flour: $6C+8V\leq9600$

Explanation:

This a linear programming problem. We have an objective function (in this case it is the profit) that we want to optimize, but complying with constraints (in this case, the availability of ingredients).

The objective function can be defined taking into account the profits of the two kind of chips:

$Profit=0.40L+0.50V$

The constraints can be expressed taking into account the amount of ingredients every unit of chip needs and stating that it has to be less or equal to the availability of this ingredient:

- Availabitily of salt:

$2L+3V\leq4800$

- Availability of herbs

$1C+2V\leq 2000$

- Availability of flour

$6C+8V\leq9600$

With these expressions the linear programming problem can be solved.

3 0

2 years ago

Which of the following series uses commas correctly?

Serjik [45]

Incorrect. You don’t need a comma after “crocodiles” or before “other”

7 0

2 years ago