ACCOUNTING
Learning Objective: Explain how firms use accounting.
Prompt:
What sort of difficulty can you imagine the manager of an organization would be in, if the organization did not routinely prepare cash flow forecasts and working capital analyses?
Instructions:
Your response must be in your own words. Your initial post should be 250 word minimumthat reflects research and not opinion. Provide attribution for the source of your learning.
Answer preview
Many new or small businesses are profitable, but there have been forced to close because they did know how to track cash flow appropriately. Cash flow is extremely important when it comes to business. Cash Flow helps the business owner or management to know the amount of money than the business has in order to meet its own obligations.
When a manager fails to prepare the cash flow forecasts and working capital analysis, it’s extremely dangerous for the business. According to Costa (2014, Jan 6), the cash flow forecast helps the management to estimate the amount of money that flows in and out of business in a given time. This includes all the revenues…
(300 words)