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Anni [7]
3 years ago
15

Changes in net operating working capital should not be reflected in a capital budgeting cash flow analysis because capital budge

ting relates to fixed assets, not working capital. T/F
Business
1 answer:
Ede4ka [16]3 years ago
6 0

Answer:

The correct answer is False.

Explanation:

Net working capital, or "Working Capital" is simply the difference between current or current assets and current or short-term liabilities of a company.

Cash flow, on the other hand, is the net amount of cash and its equivalents that is transferred inside and outside the company and that may originate in operational, investment or financing activities.

Cash flow will have an operational origin, when there is a net decrease in working capital. In this situation there will be a net cash release that the company can use freely to honor debts, reinvest in operations, pay dividends, cover expenses or provide funds for future investments.

A negative cash flow, from the point of view of operations, implies that the company has increased its cash demands to finance sales on credit or inventory. That is, it has increased its investment in working capital. Situation that will require an analysis that allows a better way to manage capital.

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Last year mike bought 100 shares of dallas corporation common stock for $53 per share. during the year he received dividends of
Pepsi [2]
Mike brought 100 shares costing $53 each.
Total costs of shares= 100*53
=$5300

He got dividends of $1.45 per share. A dividend is money that is earnt back from a share.
Total dividend amount = 1.45*100
=$145

I'm assuming that Mike sold his shares at the end of the year. He sells for $60 each.
Total sales amount=60*100
=$6000

The rate of return in this instance can be defined as the amount of money made back from a share.

Rate of return= total earnings/ costs

Total costs= $5300
Total earnings=$6145

6145/5300=1.1594
=15.9%

Hope this helps! :)
4 0
3 years ago
Innovators are a critical group of new product adopters because they:
LenKa [72]
What are asking I am confused
7 0
2 years ago
Which resources would be classified as a land factor of production?
Pani-rosa [81]
Answe: C timber
Explanation:because is a resouce that is in land factor of production
8 0
3 years ago
Walsh Company is considering three independent projects, each of which requires a $4 million investment. The estimated internal
Andrews [41]

Answer:

27.3134%

Explanation:

Note: The full question is attached as picture below

In this question is concerned, projects to be accepted will be those whose IRR is greater than the cost of capital . The projects H and L have a greater IRR than their Cost of capital.

Under residual dividend model, earnings remaining after meeting all potential projects is distributed as dividend . Funds required for projects H and L = ($4 million * 2) = $8 million

To be financed through equity = $8 million * 65%

To be financed through equity = $5,200,000

Expected net income = $7,154,000

Thus, the dividend = $7,154,000 - $5,200,000 = $1,954,000

The Payout ratio = Dividends / Earnings  = $1,954,000 / $7,154,000 =   0.273134 = 27.3134%

6 0
3 years ago
______ are the three elements of expectancy theory.a.Expectancy,b.institution,c.and varianceExpectancy,d.institution,e.and value
kobusy [5.1K]

Answer: expectancy, instrumentality and valence                                        

Explanation: These three elements can be explained as follows :-

1. Expectancy refers to the probability that the activity one is going to perform will eventually lead to good performance.

2. The belief that there is a connection between the activity be performed and the goal that is one willing to achieving is called instrumentality.

3. The degree to which the potential reward from success  are valued is called valence.

3 0
3 years ago
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