In need of a 125 response/discussion to EACH of the following forum posts. There are (4) different Forum posts. Agreement/disagreement/and/or continuing the discussion. Original forums discussion/topic post is as follows: (Use/Cite references to support.
I need an explanation for this Business question to help me study.
In need of a 125 response/discussion to EACH of the following forum posts. There are (4) different Forum posts. Agreement/disagreement/and/or continuing the discussion. Original forums discussion/topic post is as follows: (Use/Cite references to support your ideas)
FORUM POST 1:
When owning a business you should always have knowledge of the amount of money you are investing into your business and how how much is coming out. Also, when using a capital analyses it can be a great resource management tool for your business when developing a cash flow forecast. These types of financial analysis can determine the business revenue and help formulate the business budget which are needed in understanding the daily operations of the business. Each and very business owner wants to see a profit, if an organization is not monitoring their revenue smartly or often their business could take a hit and possibly go broke.
A cash flow forecast displays how much money an organization should obtain and pay out in the future or overtime. Cash flow forecast determines how much money is put in and how much money is being put out over a period of time. Usually, a cash flow forecast accommodate an open balance, installments, totals, and end of accounting periods. It is important that organizations keep record of their cash flow not all business earn their profits right away.
Business owners need to take into consideration that it need money to maintain daily operations. This could help an organization maintain and measure their expenses when it comes to the needs of the business. Also, working capital analysis provides the business with information pertaining to liquidity and current assets compared to current liabilities. This type of financial analysis helps the company understand the needs of the company’s operation whether it needs long term funding or could utilize excess cash towards long term investments. When working capital analysis the company should make sure the it is effective and beneficial to the company because the more working capital the company has the less difficulties the company will encounter financially.
Business Dictionary. (n.d.). Cash flow forecast. Retrieved from http://www.businessdictionary.com/definition/cash-flow-forecast.html
Kenton, W. (2018, Mar 9). Capital investment analysis. Investopedia. Retrieved from
Accounting tools. (2018, May 17). Working capital analysis. Retrieved from https://www.accountingtools.com/articles/working-capital-analysis.html
Gillepsie, M. (2016, Oct 18). What is cash flow forecasting?. Cash Analytics. Retrieved from
FORUM POST 2:
Good Afternoon Class,
The very first thought I had when reading this questions, after watching the video, was simply how difficult it would be to retain the job as the manager if you did not routinely prepare cash flow forecasts and working capital analysis worksheets? Cash flow forecasting allows you to monitor the inputs and outputs of cash inside the organization and then have a solid idea about how much more money may be needed (Briscoe). The skill of forecasting requires that you look at several scenarios that could happen with the cash flow and make adjustments to the process. While publishing the initial results is ideal the manager would have to go back and update the finding when things happen, and make sure he or she is always monitoring the changes in order to speak to them when asked (Briscoe).
Working capital analysis is used to determine the liquidity and sufficiency of current assets in comparison to current liabilities (Bragg). The information that comes from these report lets the managers know if more money is needed to fund a long term project or if money needs to be moved to another resource to help make improvements in that field. Seems like a manager who doesn’t track these types of cash flows would be out of the loop with how to make adjustments to the work requirements. Another thing to remember is that cash flow is not considered revenue to the business, or company, because sales revenue would be only the incoming cash flow and not taking the outward cash in to consideration (Briscoe).
Briscoe, k (2018). 5 Keys to Accurate Cash Flow Forecasting. retrieved from https://www.cfoselections.com/perspective/5-keys-to-accurate-cash-flow-forecasting
Bragg, S (2018). Working Capitol Analysis. retrieved from https://www.accountingtools.com/articles/working-capital-analysis.html
FORUM POST 3:
Cash flow consist of three things and they are operating activities, which “Cash receipts result from sales to customers”; Investment activities, which is “Cash payments result from the purchase of new equipment and other long-term assets.”; and Financing activities which is “Cash receipts and payments result from buying and selling stocks and paying cash dividends.” One of the biggest thing I can think of is employee pay and supplies. The last thing you would not want to do is not be able to pay your employees or not be on time paying your employees. This would cause you to get worthless employees, which means that you product or service you are trying to sell will lose it’s quality. You also need to make sure that you are able to resupply. Meaning that you need to be able to buy more supplies as need and not just any supplies, but quality supplies. Not be able to pay your employees or be able to resupply your product will give your company or organization a bad name. This could also cause a high turnover ratio for your employees and lead them to get a part time job; this could make your company have an hostile environment. Being able to resupply is very important as well. This allows your company to be able to keep up with supply and demand. If you can’t keep up with supply and demand and your business starts to take off, this is a good way for your business to crash. You don’t want to result in going to another supplier that’s a lot cheaper, because your supplies may not be of the same quality as before.
Both of these things are very important to plan for and this is why it’s important to have a cash flow analysts or forecast.
FORUM POST 4:
Good Morning Everyone!!
The purpose of the cash flow statement is to identify the cash flow coming in and out of the company. It tracks all the bills that are being paid as well as the money coming in. If a manager/ a small business neglects to regularly make a forecast of the cash flow, how will the company know they are going to be able to meet all of their financial obligations? It would be impossible to have any real understanding of his current business finances. Consequently, he/she would have a difficult time when it came to making payroll, paying the bills and taxes while still maintaining enough money to keep the business up and running. “Cash flow is the lifeblood of any small business and how it’s managed can mean the difference between your company’s success or failure” (Certusi, 2011). Understanding how cash flow affects a small business is critical, this is the only way he/she will be able to make the correct economic and managerial assessment for any and all aspects of his business’ finances. It happens to many times to count that a business will fail because they realize too late that there is a cash flow problem. This usually ends in the company becoming financially distressed and as a result, the business will lose investors, and employees end up in the unemployment line. “the cash flow of a business will be a reflection of the state of a business finances” (Mazouz et al, 2012).
A healthy cash flow, is a good indication that a business will grow and succeed. The opposite is also true cash flow problems, may suggest that chances are high that the business won’t last for long. Monitoring your cash flow analysis will give management time to take corrective action and adjust properly to better the business financial condition of the company
Certusi, C. (2011, July 4). Cash Flow: The Lifeblood of Every Small Business. Retrieved March 9, 2020, from https://www.canadaone.com/ezine/jul11/cash_flow.ht…
Mazouz, A., Crane, K., & Gambrel, P. A. (2012). The impact of cash flow on business failure analysis and prediction. International Journal of Business, Accounting and Finance (IJBAF), 6(2), 68.
Piatti, D. (2014). Operating cash flow and creditworthiness assessment. Academy of Accounting and Financial Studies Journal, 18(2), 1.
In need of a 125 response/discussion to EACH of the following forum posts. There are (4) different Forum posts. Agreement/disagreement/and/or continuing the discussion. Original forums discussion/topic post is as follows: (Use/Cite references to support