Outline the Importance of Cash

Read through the below post and provide any on of the following: APA format 250 Words.

.Ask a probing question, substantiated with additional background information, evidence or research.

· Share an insight from having read your colleagues’ postings, synthesizing the information to provide new perspectives.

· Offer and support an alternative perspective using readings from the classroom or from your own research.

· Validate an idea with your own experience and additional research.

· Make a suggestion based on additional evidence drawn from readings or after synthesizing multiple postings.

Post:

Part-1 Importance of Cash

Cash flow in company or in human life, shows most important part in terms of financial health of company or life satisfaction of human being respectively. In similar manner, if amount of cash invested in some project is less than the return cash earned from the same project than it can be said that company made profit. But if the outflow of cash is greater than inflow, than that is part of loss in organization.

Cash flow and profit and loss statement are totally different. Personal finance could be the best example to differ cash flows and P&L statement, as those expenses are not added in P&L sheet. Cash flows as per the name refers to cash flows in company during running. Deposit and withdrawal in account is common. Deposit can be from product sales, investment etc. While withdrawal is for many reasons such as, regular payment to employees, rent, bills, loans etc. Therefore, cash flows are totally related to inflow and outflow of cash. Profit and loss statements are calculation of period or term project. It gives amount of cash used and invested during that period. On the basis of that calculation, positive balance and negative balance will conclude as profit and loss (Satterley, 2017).

Managers and executives are the chair responsible person for the cash management. They can used different methods fort the calculation or prediction of cash flows for the projects. Information communication technology is one of the method that would be use for cash management. It focuses on three basic measure of financial department performance, cost saving, improvement in quality and enhancement in scenario for the decision making. On the basis of such methodology, performance of the company would be predicted and it can be helpful to further decision making for managers (San-Jose, Iturralde & Maseda, 2009).

Part 2: Application of Concepts: The Role of Financial Statements in Managerial Decision Making

Different financial statement could be used by the mangers in order to make financial decisions. Pro Forma statement is also one of the most important method used for making financial decisions. It basically analyze cash inflow and outflow of the organization along with activity, amount of debt in market, profitability and market value. Percent of sale is the simple method used for the development of pro forma statement. It involves the past financial performance of company in order to predict future situation.

Pro forma statements can be created in four following steps. Firstly, estimating projection of company’s revenue. Second, calculating amount of loans and line of credit. Third, cash flow estimation and last, preparing charts of accounts for the time period. All this calculation are generally prediction, managers used this method for the future financials situation company and all this values are updated as per time and condition (Pacific Crest Group, 2016).

LOOKING FOR THIS ASSIGNMENT OR A SIMILAR ONE? WE HAVE HAD A GOOD SUCCESS RATE ON THIS PAPER! ORDER WITH US TODAY FOR QUALITY WORK AND GET A DISCOUNT!

ORDER NOW

Disclaimer:

All types of paper that Discount Writers provides is only for the purpose of assistance! No text, paper, assignment, discussion would be similar with another student therefore guaranteeing Uniqueness and can be used with proper references only!

More tools: Better Grades: Choose your Homework Help:

Assignment Help: We would write your papers according to the instructions provided and guarantee you timely work

 

Entire Online Class Help: We are here for you and we would do your entire Class work from discussions, assignments, Replies, Exams and Quizzes at a Cost

 

Exam/ Quiz Help: We have a team of writers who specialize on exams from any specific field and we would give you an A+ Grade!

 

ORDER NOW