🏷️ LIMITED TIME OFFER: GET 20% OFF GRADE+ YEARLY SUBSCRIPTION →
Log in
Finance
2
answers
0
watching
53
views
20 Feb 2018

Describe the MAJOR differences in how Creditors and Investors would view the financial performance of any company

Highlight how each might use the information contained in Income Statements, Statements of Cash Flows and Balance Sheets differently.

Watch
2
answers
0
watching
53
views

For unlimited access to Homework Help, a Homework+ subscription is required.

Unlock all answers

Get 1 free homework help answer.
Already have an account? Log in
Share
Tod Thiel
Tod ThielLv2
21 Feb 2018
Already have an account? Log in
Share

Related questions

Consider the following point and counter-point arguments. Which argument to you support? Explain why and offer your own opinion on the issue.

Point: Investors should not care about an MNC’s translation exposure. The present value of an MNC’s cash flows is based on the cash flows that the parent receives. Any impact of the exchange rates on the financial statements is not important unless cash flows are affected. MNCs should focus their energy on assessing the exposure of their cash flows to exchange rate movements and should not be concerned with the exposure of their financial statements to exchange rate movements. Value is about cash flows, and investors focus on value.


Counter-Point: Investors should care about an MNC’s translation exposure. Investors do not have sufficient financial data to derive cash flows. They commonly use earnings as a base, and if earnings are distorted, so will be their estimates of cash flows. If they underestimate cash flows because of how exchange rates affected the reported earnings, they may underestimate the value of the MNC. Even if the value is corrected in the future once the market realizes how the earnings were distorted, some investors may have sold their stock by the time the correction occurs. Investors should be concerned about an MNC’s translation exposure. They should recognize that the earnings of MNCs with large translation exposure might be more distorted than the earnings of MNCs with low translation exposure.

What advantages do sole proprietorships and partnerships offer?What is a major drawback of these types of organization? (10points)

In a corporate governance, what group has the ultimateresponsibility for monitoring management and protecting thestockholders' interests? Who elects this group? (10 points)

What is meant by maximizing owner’s equity value (shareholderwealth)? Why are maximizing just net income, or just profit,inappropriate goals? (10 points)

List and describe the four major financial statements. (20points)

Why do financial managers and investors find cash flows to bemore important than accounting profit? (10 points)

What information does time series analysis provide for firmmanagers, analysts, and investors? (10 points)

Define the following ratios and explain their significance. (30points)

Quick ratio,Average collection period ,Return on equity,Debtratio, Profit margin

  1. Explain the flow of information and the sequence in preparingthe four basic financial statements: income statement, statement ofretained earnings, balance sheet, and statement of cash flows.

Related Documents

AFF 210 Chapter Notes - Chapter 3: Value Line, Canadian Business, Food Processor
limehorse403
FIN 3200 Lecture Notes - Lecture 2: Reserve Requirement, Income Statement, Asset Turnover
limemule21
FIN 301 Chapter Notes - Chapter 4: Cash Flow, Current Liability, Financial Statement
yellowminnow102

Weekly leaderboard

Home
Homework Help 3,900,000
Finance 370,000
Start filling in the gaps now
Log in