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Outflows of assets refer to the movement of funds or resources out of a company or investment account, typically resulting in a decrease in total assets. This can occur through various means, such as withdrawals, sales of investments, or expenses. Outflows are often tracked to assess financial health and liquidity, as they can indicate cash flow challenges or shifts in investment strategies. Understanding outflows is crucial for managing financial stability and planning for future growth.
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Distinguish between Current account and capital account?
A current account is the balance of net transfers, trade in goods, net investment income from external assets and trade in services. A capital account shows the outflows and inflows of different forms of capital.
How does the issuing of capital stock effect net income?
Somebody please correct me if I am wrong, but issuing capital stock increases total assets. If one considers total assets when calculating net income, any capital stock or additional paid in capital must be deducted from total assets in order to find net income. Issuance of stock does not contribute to income from operations; it is a financing activity that contributes to total equity. Also, if there are dividend payments for the year, these outflows must be added to assets before arriving at net income.
How might a firm benefit from delaying its cash outflows?
h
How is a cash budget used to help manage current assets?
A cash budget helps minimize current assets by providing a forecast of inflows and outflows of cash. It also encourages the development of a schedule as to when inventory is produced and maintained for sales (production schedule), and accounts receivables are collected. The cash budget allows us to forecast the level of each current asset and the timing of the buildup and reduction of each.
How is cash buget used to help manage current assets?
A cash budget is a financial tool that helps organizations plan and manage their cash flow over a specific period. By forecasting cash inflows and outflows, it enables businesses to ensure they have sufficient liquidity to meet short-term obligations and manage current assets effectively. This proactive approach helps identify potential cash shortages or surpluses, allowing for better decision-making regarding investments in current assets, such as inventory and receivables. Ultimately, a cash budget supports financial stability and operational efficiency.
What items are outflows in the circular flow?
trading of productsdepreciation of assetsmoney put in a savings fundretained earnings of assets
Why are there no capital assets in governmental type funds?
There are no capital assets in governmental-type funds because those funds account only for inflows and outflows of financial resources. Governmental-type funds can be used and indeed are used to acquire capital assets. When that happens, however, the accounting within the funds is such that there is an expenditure of financial resources, rather than an exchange of a financial resource for a capital asset. Capital assets are reported in government-wide financial statements, but not in fund financial statements.
Why are there no capital assets in government type funds?
There are no capital assets in governmental-type funds because those funds account only for inflows and outflows of financial resources. Governmental-type funds can be used and indeed are used to acquire capital assets. When that happens, however, the accounting within the funds is such that there is an expenditure of financial resources, rather than an exchange of a financial resource for a capital asset. Capital assets are reported in government-wide financial statements, but not in fund financial statements.
What are the effects of inflows and outflows of your economy?
23
What are the effects of outflows and inflows in your economy?
23
Distinguish between Current account and capital account?
A current account is the balance of net transfers, trade in goods, net investment income from external assets and trade in services. A capital account shows the outflows and inflows of different forms of capital.
How does the issuing of capital stock effect net income?
Somebody please correct me if I am wrong, but issuing capital stock increases total assets. If one considers total assets when calculating net income, any capital stock or additional paid in capital must be deducted from total assets in order to find net income. Issuance of stock does not contribute to income from operations; it is a financing activity that contributes to total equity. Also, if there are dividend payments for the year, these outflows must be added to assets before arriving at net income.
What are tidal outflows called?
Tidal outflows are called ebb currents. Ebb currents occur when water flows away from the shore as the tide goes out.
What factors are used to determine relative cash position?
Relative future cash position can be determined by following aspects: 1. The Working cycle of the company 2. Debt Servicing required in future. 3. Requirement of Funds for purchasing capital assets etc. The above list is inclusive list of the cash outflows of the business enterprise. Cash Outflows as well as inflows needs to be determined in order to get details of cash position in future.
How might a firm benefit from delaying its cash outflows?
h
Why do businesses need to plan their inflows and outflows?
Not too sure
How is a cash budget used to help manage current assets?
A cash budget helps minimize current assets by providing a forecast of inflows and outflows of cash. It also encourages the development of a schedule as to when inventory is produced and maintained for sales (production schedule), and accounts receivables are collected. The cash budget allows us to forecast the level of each current asset and the timing of the buildup and reduction of each.
