- Katherine had to rush to the bank every few months to borrow more money. She didn't really talk to her banker about her financial situation because she had no trouble getting larger loans. You see, she was always on time with her payments. Katherine always took trade discounts to save money on her purchases. That is, she paid all of her bills within 10 days in order to save the 2% discount offered by her suppliers for paying so quickly.
- Katherine's products were mostly purchased on credit. They'd buy a few lamps and a pot, and Katherine would let them pay overtime. Some were extremely slow to pay her, taking six months or more.
- Katherine noticed a small drop in her business after three years. The local economy was struggling, and many people were losing their jobs. Nonetheless, Katherine's business remained steady. Katherine received a phone call from the bank one day, informing her that she was behind on her payments. She explained that she had been so preoccupied that she had missed the bills. The issue was that Katherine did not have enough money to pay the bank. She frantically called several customers for payment, but none of them could pay her. Katherine had a classic cash flow problem.
<h3>How is it possible to have high sales and high profits and run out of cash while running a business?</h3>
It is entirely possible if you have a high level of accounts receivables and inventory and a low level of accounts payables. A sale is recorded when an invoice is raised, and a shipment is delivered; this does not always imply that you received cash and that it is recorded in your accounts receivable. Similarly, if you keep a lot of inventory, a lot of your money is locked up until the inventory is sold. On the contrary, if your payment terms with your suppliers are less favorable, you will end up paying before your receivables convert to cash. As a result, high sales and profits do not always imply a strong cash position.
Learn more about profit:
brainly.com/question/13050157
#SPJ4
Answer:
Autonomy
Explanation:
correct answer is Autonomy because Autonomy is the ability to make informed, immoral decision-making, and especially in moral psychology and moral psychology and morality. Autonomous bodies or organizations are autonomous or autonomous. Autonomy can also be defined from the human resources perspective, where it refers to the level of discretion given to an employee in his or her work.
Answer:
A. 3.21 years
Explanation:
In the payback, we analyze in how many years the invested amount is recovered. The computation is shown below:
In year 0 = $7,500
In year 1 = $1,100
In year 2 = $1,640
In year 3 = $3,800
In year 4 = $4,500
If we sum the first 3 year cash inflows than it would be $6,540
Now we deduct the $6,540 from the $7,500 , so the amount would be $960 as if we added the fourth year cash inflow so the total amount exceed to the initial investment. So, we deduct it
And, the next year cash inflow is $4,500
So, the payback period equal to
= 3 years + $960 ÷ $4,500
= 3.21 years
In 3.21 yeas, the invested amount is recovered.
Susie’s IQ falls into the average category. It is because
since she receive the IQ score of 90, a person with an IQ score of 90-109 is
considered to have a normal up to the average intelligence in which she
acquires.