BSM 200 Lecture Notes - Lecture 10: Current Liability, Asset Management, Trade Credit
23 Mar 2017
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Link to work & purpose document supporting investment stamp of approval: cost of borrowing. When will we need funds (externally?: steps in planning. Source of funds debt + equity. Satisfactory return on investment: profitability, investment utilization. Sound financial position of firm: liquidity cash position in the organization i. e. how quickly you can pay off your debt, stability no fluctuation i. e. stable pattern of income and profit of the organization. Where do we stand: financial ratios provide insight into financial strengths and weaknesses, use financial data from balance sheet and income statement, companies can compare their ratios with other businesses in the same industry or admired- firms . Managing cash: need cash to pay bills, cash does not earn returns, source of cash is from sales but remember there are credit sales and cash sales, credit sales? can influence firm"s woking bills still need to be paid. Managing accounts receivable: what credit customers owe the firm, to ensure timely recovery:
