If the firm utilizes a cash basis rather than the accrual basis accounting methodology, all else being equal, the firm's deficit will be: O Decreased, which means it becomes more positive. O Changed and the firm will become more profitable. O Increased, which means it becomes more negative. O Unchanged, which means it becomes increasingly positive.

Q: If a firm’s ROE is low and management wants to improve it, explain how using more debtmight help.

A: ROE refers to return on equity.It is a measure of profitability of a firm with respect to its…

Q: is(are)the reason(s) for profit maximization not a reasonable goal for firms. a. Profit concept…

A: Profit Maximisation Concept aims at carrying out the business activities in such a way that the…

Q: Which of the following does not assign a value to a business opportunity using time-value…

A: Answer : D Payback period method

Q: What is the most likely cause of an increase in business's gross margin?

A: An increase in a business's gross margin is typically attributed to factors that positively impact…

Q: In general, as a company increases the amount of short-term financing relative to long-term…

A: Explanation :   An increase in the proportion of short-term financing will not affect a company’s…

Q: Which of the following methods can NOT be used to improve the firm’s cash conversion cycle?…

A: Cash conversion cycle (CCC) expresses the length of time, in days, that it takes for a company to…

Q: Suppose a company increases the price of its product and demand hardly declines.which of the…

A: The increase in the price off the product where the demand hardly declines will lead to increase in…

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: Can a company have a high net income but not enough cash to pay its bills? Explain your response.…

A: Answer:-  Cash flow meaning:- Cash flow is basically the inflow and outflow of the cash into the…

Q: What would be a reason a company would want to understate income?A. to help nudge its stock price…

A: Profitability of the business is an important measure for business evaluation. It depends on the…

Q: Which of the following statements is NOT CORRECT? why?   The corporate valuation model can be used…

A: Corporate Valuation Model(CVM) is used to ascertain market value of business entities. CVM includes:…

Q: Which of the following would increase a company’s additional financing needed (AFN)? a) the…

A: AFN is used in context of business looking to expand. Additional funds needed are raised using notes…

Q: Which of the following statements is false regarding the abnormal earnings approach to valuation?…

A: Abnormal earning valuation This method of valuation helps to determine company’s net worth based on…

Q: Gross Profit Ratio for a firm remains same but the Net Profit Ratio is decreasing. The reason for…

A: Gross profit is given by sales revenue minus cost of goods sold. Gross profit =Sales revenue- cost…

Q: Under what situation will return on equity be higher than return on investment? a. When assets…

A: (a) When assets exceed liabilities:Suppose assets is $ 70,000 and liabilities is $ 50,000 and net…

Q: rn on total assets can improve its return on equity, all else remaining the same, but   A.…

A: Return on Equity (ROE) evaluates asset management, cost management, and debt management, a company…

Q: Give typing answer with explanation and conclusion Which of the following is false? A) All else…

A: Interval measure shows how many days a business can run with funds on hands. A more interval measure…

Q: Which of the following statements is correct?   a. Any forecast of financial requirements involves…

A: Option D is correct. Financing feedbacks describes the fact that interest must be paid on the debt…

Q: Consider the following case of Cold Duck Manufacturing Inc.: Cold Duck Manufacturing Inc. has no…

A: The sustainable growth rate can be found by multiplying the retention with the return on equity…

Q: Discuss and explain the difference between profit/loss and cash flow.

A: Given: The difference between the profit/loss and cash flow of the finance of the entity or an…

Q: Why might one firm have positive cash flows and be headed for financial trouble, whereas another…

A: One firm might have positive cash flows and be headed for financial trouble if it is not generating…

Q: Which of the following statements is correct? A firm has a greater likelihood of needing an…

A: The following statement is correct

Q: Which of the following is true about a firm with products in the decline stage of their lifecycle? O…

A: The decline phase in the life cycle of a firm's product is when the sales start declining and…

Q: Practice : a: The computation of return on average investment ignores one characteristic of the…

A: Capital budgeting refers to the technique of evaluating a project for investing in it. It has…

Q: Which of these would best improve a firm's liquidity position? * a. Lower profitability b.  Higher…

A: The following is a summary of the risk-return syndrome: When liquidity rises, the chance of…

Q: M-M theroy with perfect market suggests that divident payment: A.It dependes on the company's…

A:

Q: 1. How is it possible for a firm to be profitable and still go bankrupt? Select one: a. The firm…

A: Current ratio=Current assetsCurrent liabilities

Cash Flow Statement Analysis

A company's cash flow is the movement of its cash inflows and cash outflows. A cash flow statement is prepared to determine changes in an organization's cash position. A cash flow statement shows how much money was generated and spent on the business during the fiscal year. The cash flow analysis is a method of analyzing an organization's investing, financing, and operating activities. A cash flow statement reveals an organization's liquidity and solvency, as well as its ability to change cash flows in the future. It eliminates the other effects of accounting methods by improving the comparability of different organizations' operational performance.