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2 years ago

One of the reasons why cash flow analysis is popular is because ________.

Business

1 answer:

konstantin123 [22]2 years ago

6 0

Answer:

Explanation:

Cash flow is the flow of cash and cash equivalent in and and out of a business.

there are three types of cash flows:

1. Investing cash flow - It involves the use of long term cash. it is the cash flow generated from the purchase and sale of fixed asset e.g. Sale of plant assets.

2. operating cash flow - it shows the net amount of cash generated from a company's normal business operation

3. financing cash flow - it shows the net amount of funding a company receives over a given period e.g. issuance of common stock

Reasons why cash flow analysis is popular

Cash flows are less subject to manipulation when compared with net income
Cash flow in often positive when net income is negative or zero

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a sophisticated blank test might involve manipulating an advertising variable like schedule or copy through cable systems, and o

erma4kov [3.2K]

A sophisticated sales test might involve manipulating an advertising variable like schedule or copy through cable systems, and observing the affects on purchasing at local supermarkets.

What is advertising variable?

Although advertising expenditures can change greatly, they are not regarded as variable costs.
Instead, marketing costs are fixed, meaning they don't change based on how many goods or services you offer to customers.

Why is marketing considered a variable cost?

Businesses may set aside a specific amount for advertising within their fixed marketing budget, despite having a fixed budget for marketing.
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Learn more about advertising a variable cost

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1 year ago

Justice Enterprises is evaluating the purchase of a new computer net system would cost $24,000 and have a useful life of Syears.

Sergeeva-Olga [200]

Answer:

closest to: B) $7777

Explanation:

NPV ( net presetn value) cashflow - investment

<u>cost savings present value (ordinary annuity):</u>

$C \times \frac{1-(1+r)^{-time} }{rate} = PV\\$

C $8,500

time 5 years

rate 0.12

$8500 \times \frac{1-(1+0.12)^{-5} }{0.12} = PV\\$

PV $30,640.5977

salvage value present value:

$\frac{salvage}{(1 + rate)^{time} } = PV$

Salvage $2,000

time 5

rate 0.12

$\frac{2000}{(1 + 0.12)^{5} } = PV$

PV 1,134.85

NPV: 30,640.60 + 1,134.85 - 24,000 = 7,775.45

4 0

3 years ago

Ajax is reviewing its previous 100% acquisition of Baxter to determine if there is goodwill impairment. At December 31, 2020 Aja

Sedaia [141]

Answer:

Baxter

The amount of the Goodwill write-off required to be booked by Ajax at December 31, 2020 under the FASB rules effective in 2020 is:

= $130,000.

Explanation:

a) Data and Calculations:

Recorded Goodwill = $330,000

Book value of net assets = $400,000

Book value of all assets = $730,000 ($400,000 + $330,000)

Estimated fair value of company = $600,000

Goodwill impairment = $130,000 ($730,000 - $600,000)

b) The Goodwill impairment of $130,000 arose when the book value or the carrying amount exceeded the estimated fair value.

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2 years ago

When the sales of a certain brand of diet soda slowed, a national grocery retailer decided to drop the price of that product, wh

Zigmanuir [339]

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3 years ago

Southwest U's campus book store sells course packs for $14 each. The variable cost per pack is $12, and at current annual sales

Mumz [18]

Answer:

$23,000

Explanation:

current annual sales = 49,000 packs

Selling price of course packs = $14 each

variable cost per pack = $12

Earnings = $75,000

Contribution:

= current annual sales × (Selling price of course packs - variable cost per pack)

= 49,000 packs × ($14 - $12)

= 49,000 packs × $2

= $98,000

Fixed costs of producing the course packs:

= Contribution - Earnings

= $98,000 - $75,000

= $23,000

4 0

3 years ago