Can a firm have income without also having a positive cash flow? Explain.

Q: What is alternative cash flow measures?

A: Cash flow refers to the amount of cash that moves in and out of the business because of its…

Q: a. What is meant by a company's cost of capital? b. Why is the company's cost of capital critical…

A: Company needs fund to purchase the assets and for operations. Companies finance with Debt and…

Q: What kind of change is represented in a firm by the incremental, cash flows?

A: Incremental cash flow refers to change in the cash flow of the company with respect to a investment…

Q: How does additional debt in a firm influence its WACC? its free cash flow (FCF)? the agency costs of…

A: Debt is the presence of additional financial leverage in the total business and it will be having…

Q: Why should a firm's investments always exceed its cost of capital?

A: The main aim behind any investment is to generate returns for the company. These projects help the…

Q: How can the components of working capital affect the cash position of a firm?

A: The question is based on the concept of working capital and effect of change in working capital on…

Q: risk implications of improving net profit margin to increase Return on Equity?

A: Net profit margin is the percentage of net profit to sales revenue

Q: Is a negative free cash flow (FCF) always a bad sign? A negative free cash flow means that the…

A: Yes. Negative free cash flow is not necessarily bad. Most rapidly growing companies have negative…

Q: Is it true that A high return on assets (Ropa) is an indication that a firm has a high level/value…

A: ROA shows how profitable a company is with respect to it sassets. formula: ROA = NET INCOMETOTAL…

Q: Collin Cunningham started working with Dewar’s Limited on September 1st, 2018. He had not been…

A: In 2018 the standard deduction was $ 12,000 for single filers. Working note :-…

Q: it better to finance a company thru debt or thru equity? Why? What are the downside and upside to…

A: A business can raise funds predominantly either by  Issuing Equity, or Borrowings Loans, Issuing…

Q: Can free cash flow continue to grow, even if ROIC falls? Explain.

A: If the working capital of the company can be managed free cash flow can grow at a better rate even…

Q: 1. Can a firm with positive net income run cash? Explain.

A: Cash is very important in the business and there is need of cash in business and no business can…

Q: How does a short-term cash flow crisis impact a firm's competitive strategy?

A: It is very important for any business to have cash in hand or at the bank for meeting day-to-day…

Q: What contrasts are there between what is shown in cash flow statements and the need for firms to…

A: Cash flow statement is prepared on cash basis and it shows the actual cash position of the company.…

Q: How can we determine the firm's liquidity?

A: Liquidity: It can be defined as the ease or comfort with which a firm can convert its securities and…

Q: Explain "frce cash flows. Why do managers like to retain free cash flows instead of distributing it…

A: Free cash flows : As the name suggests, free cash flows relates to the fund that are leftover to a…

Q: What are some pros and cons of having a high cash ratio?

A: The ratio analysis helps to analyse the financial statements of the business.  The cash ratio is…

Q: Why is it important for a firm to know how to determine their cost of capital?

A: Cost of capital is the cost that a business incurs for financing its business, operations and…

Q: what factors determine the need cash in the firm's operations?

A: The following are the factors: 1. Purchase and Sale Terms 2. Receivables Collection Period 3. The…