The cash flow statement (CFS) measures how well a company manages its cash position, meaning how well the company generates cash to pay its debt obligations and fund its operating expenses. The cash flow statement complements the balance sheet and income statement and is a mandatory part of a company's financial reports since 1987.1
In this article, we'll show you how the CFS is structured, and how you can use it when analyzing a company.
KEY TAKEAWAYS
A cash flow statement is a financial statement that summarizes the amount of cash and cash equivalents entering and leaving a company.
The cash flow statement measures how well a company manages its cash position, meaning how well the company generates cash to pay its debt obligations and fund its operating expenses.
The cash flow statement complements the balance sheet and income statement and is a mandatory part of a company's financial reports since 1987.1
The main components of the cash flow statement are cash from operating activities, cash from investing activities, and cash from financing activities.
The two methods of calculating cash flow are the direct method and the indirect method.
Answer:
It is called a Business to Business or B2B Marketing
Explanation:
B2B or Business to Business Marketing simply occurs when a business organisation decides to going into transaction with an other business organisation. The two businesses can be within the same locality or not. A criteria is that a B2B marketing involves a commercial transactions which would be to the benefit of both parties.
The <u>opposite of B2B is B2C (Business to Consumer) marketing, this is the commonly known type of marketing where a consumer/individual</u> patronizes the products of a manufacturer or business organisation.
B2B will usually occur when a company needs certain products or materials to complete its own finished goods and this can be purchased from another organisation that has been adjudged to be a producer of same.
It could also occur, when a business is required to take on the services of another business for instance in audit cases.
In the case of the question, the global positioning system is a finished product of the electronics company required by the car manufacturer to complete his own finished product (the car). Hence, the B2B marketing.
Answer:
d. buyback
Explanation:
The scenario that is being described is a form of countertrade known as buyback. There are two reasons why this usually happens. The first is that the manufacturing company has limited access to liquid funds in the country which they are currently located and the goods provide better value. The second circumstance would be that they believe that the product being produced will increase in value and their profits will increase by holding the product as opposed to liquid funds.
Answer:
Dr Inventory Purchases $250
Cr Trade Payables $250
Explanation:
At the time of the purchase, Inventory purchases which is an asset in nature has been increased and hence must be debited by $250 and similarly the Payable has been increased which is liability in nature and hence must be credited with $250. The entry would be as under:
Dr Inventory Purchases $250
Cr Trade Payables $250
Answer:
c. Increase by $0.1 trillion
Explanation:
Investment spending Multiplier is a concept in economics that measure how a given change in investment increases output. So if current output of $13.5 trillion must increase to $14 trillion, we employ the multiplier formula to derive what amount of investment spending is needed to get $o.5trillion increase in output.
(change in output)/ (change in investment) = 1/(1-mpc)
Note that mpc means marginal propensity to consume.
Let change in investment = X
change in output = 14 - 13.5 = $0.5trillion
mpc = 0.8
(0.5)/X = 1(1-0,8)
0.5/X = 1/0.2
cross multiply
X = 0.1
Thus the needed change in investment is an increase of $0.1 trillion. In other words, if investment increases by $0.1 trillion, current output will increase from $13.5 trillion to $14 trillion.
