How would a decrease in net earnings and cash flow from operating affect investors? What are...
How would a decrease in net earnings and cash flow from operating affect investors? What are the investors going to do in the short term and the long term?
Homework Answers
There are various reasons to see decrease in Net Earnings and Cash flow from Operating activities. They are as follows
1- Company not operating at peak efficiency
2- Decrease in Demand for companies products
3- Increased in raw material cost and labor cost.
4- Availability of substitute products etc.
Effect on Investors
1) Decrease in Net Earnings and Cash flow from Operating activities impacts Dividend payments.
2) It will impact the amount of transfer that will be made to retained earnings.
3) Earning Per Share is reduced
4) Share Price would fall and investors may lose their money
What should investors do in short term
1) If company has sound balance sheet, investors can continue to keep their money in the company
2) If the net earning is reduced due to one time incident and fundamentally strong, they can continue to keep their investment
3) Companies future business and revenue guidance is sound, then continue to keep the money in company
What should investors do in Long term
1) If company is fundamentally strong, then accumulate the investment value as and when companies stock price falls due to decrease in NET earnings
2) If Company is unable to cope up with technology and unable to challenge competitors, then investors can sell their investments.
Add Answer to:
How would a decrease in net earnings and cash flow from
operating affect investors? What are...
Why would a decrease in cash flow from operating activities alone would not a be a...
Why would a decrease in cash flow from operating activities alone would not a be a huge problem but it is a huge problem if there is a decrease in both net earnings and cash flow from operations.
a. increase in cash flow from operating activities. b. decrease in cash flow from operating activities....
a. increase in cash flow from operating activities. b. decrease in cash flow from operating activities. C.. increase in cash flow from investing activities. d. decrease in cash flow from investing activities. e. increase in cash flow from financing activities. f. decrease in cash flow from financing activities. g. not a cash flow. 1. Payment on the principal portion of long-term debt 2. Issuance of bonds 3. Increase in accounts receivable 4. Cash dividends declared and not yet paid 5....
When creating the operating section of the cash flow statement using the indirect method are the...
When creating the operating section of the cash flow statement using the indirect method are the following adjustments added to Net Income or subtracted from Net Income? Depreciation expense (Select] Gain on sale of long-term asset [Select ] Loss on sale of long-term asset (Select] Increase in short-term liabilities (Select] Decrease in short-term assets [Select] Decrease in short-term liabilities (Select] Increase in short-term assets (Select] [Select] W added to subtracted from added to Net Income for A company is $100,000....
Complete the cash flow from Operating Activities Additions to Net Income Decrease in accounts receivable Decrease...
Complete the cash flow from Operating Activities
Additions to Net Income Decrease in accounts receivable Decrease in inventory Decrease in prepaid assets Increase in accounts payable Increase in accrued liabilities Deductions from Net Income Increase in accounts receivable Increase in inventory Increase in prepaid assets Decrease in accounts payable Decrease in accrued liabilities 450 $300 Cash Flow From Operating Activities Net Income $110 Net Cash Provided by Operating Activities 2011 80 115 Cash Flows From Investing Activities Income Statement For...
What is the Cash Flow from Operating Activiy for 2019 What is Cash Flow from investing...
What is the Cash Flow from Operating Activiy for 2019
What is Cash Flow from investing Activity for 2019
What is the Cash Flow from Financing Activity for 2019
2018 2019 2018 2019 Assets Liabilities & Equity Current assets: Cash and marketable securities $ 5 19 29 Current liabilities: Accrued wages and taxes Accounts payable Notes payable $ 5 20 36 S 6 15 Accounts receivable S 10 16 = = = Inventory Total $ 53 $ 61 Total $...
STATEMENT OF CASH FLOWS FOR 2017 Cash Flow from Operating Activities Cash Flow from Investing Activities...
STATEMENT OF CASH FLOWS FOR 2017
Cash Flow from Operating Activities
Cash Flow from Investing Activities
Cash Flow from Financing Activities
Net
Increase in Cash
Beginning
Cash Balance
Ending Cash
Balance
Selected financial statement information and additional data for Stanislaus Co. is presented below 2017 $64,200 143,800 Cash Accounts receivable (net) Inventory Land Equipment TOTAL 2016 $41,610 85,190 168,040 55,130 508,180 $858,150 203,770 18,620 791,360 $1,221,750 $81,340 $113,560 Accumulated depreciation Accounts payable Notes payable - short-term 85,250 50,590 66,800 29,460...
Determining Net Income from Net Cash Flow from Operating Activities Curwen Inc. reported net cash flow...
Determining Net Income from Net Cash Flow from Operating
Activities
Curwen Inc. reported net cash flow from operating activities of
$196,600 on its statement of cash flows for the year ended December
31. The following information was reported in the Cash Flows from
Operating Activities section of the statement of cash flows, using
the indirect method:
Determining Net Income from Net Cash Flow from Operating Activities Curwen Inc. reported net cash flow from operating activities of $196,600 on its statement...
1.) What can creditors, investors, and other users learn from an analysis of the cash flow...
1.) What can creditors, investors, and other users learn from an analysis of the cash flow statement? 2.) Identify the following as financing activities (F) or investing activities (I): a.) Purchase of equipment b.) Purchase of treasury stock. c.) Reduction of long-term debt. d.) Sale of building e.) Resale of treasury stock. f.) Increase in short-term debt. g.) Issuance of common stock. h.) Purchase of land. i.) Purchase of common stock...
Determining Net Income from Net Cash Flow from Operating Activities Curwen Inc. reported net cash flow...
Determining Net Income from Net Cash Flow from Operating Activities Curwen Inc. reported net cash flow from operating activities of $161,000 on its statement of cash flows for the year ended December 31. The following information was reported in the Cash Flows from Operating Activities section of the statement of cash flows, using the indirect method: Decrease in income taxes payable $3,100 Decrease in inventories 7,900 Depreciation 12,100 Gain on sale of investments 5,400 Increase in accounts payable 2,200 Increase...
Determining Net Income from Net Cash Flow from Operating Activities Curwen Inc. reported net cash flow...
Determining Net Income from Net Cash Flow from Operating Activities Curwen Inc. reported net cash flow from operating activities of $227,600 on its statement of cash flows for the year ended December 31. The following information was reported in the "Cash flows from operating activities" section of the statement of cash flows, using the indirect method: Decrease in income taxes payable $4,100 Decrease in inventories 10,300 Depreciation 15,900 Gain on sale of investments 7,200 Increase in accounts payable 2,900 Increase...
a. increase in cash flow from operating activities. b. decrease in cash flow from operating activities. C.. increase in cash flow from investing activities. d. decrease in cash flow from investing activities. e. increase in cash flow from financing activities. f. decrease in cash flow from financing activities. g. not a cash flow. 1. Payment on the principal portion of long-term debt 2. Issuance of bonds 3. Increase in accounts receivable 4. Cash dividends declared and not yet paid 5....
When creating the operating section of the cash flow statement using the indirect method are the following adjustments added to Net Income or subtracted from Net Income? Depreciation expense (Select] Gain on sale of long-term asset [Select ] Loss on sale of long-term asset (Select] Increase in short-term liabilities (Select] Decrease in short-term assets [Select] Decrease in short-term liabilities (Select] Increase in short-term assets (Select] [Select] W added to subtracted from added to Net Income for A company is $100,000....
Complete the cash flow from Operating Activities
Additions to Net Income Decrease in accounts receivable Decrease in inventory Decrease in prepaid assets Increase in accounts payable Increase in accrued liabilities Deductions from Net Income Increase in accounts receivable Increase in inventory Increase in prepaid assets Decrease in accounts payable Decrease in accrued liabilities 450 $300 Cash Flow From Operating Activities Net Income $110 Net Cash Provided by Operating Activities 2011 80 115 Cash Flows From Investing Activities Income Statement For...
What is the Cash Flow from Operating Activiy for 2019
What is Cash Flow from investing Activity for 2019
What is the Cash Flow from Financing Activity for 2019
2018 2019 2018 2019 Assets Liabilities & Equity Current assets: Cash and marketable securities $ 5 19 29 Current liabilities: Accrued wages and taxes Accounts payable Notes payable $ 5 20 36 S 6 15 Accounts receivable S 10 16 = = = Inventory Total $ 53 $ 61 Total $...
STATEMENT OF CASH FLOWS FOR 2017
Cash Flow from Operating Activities
Cash Flow from Investing Activities
Cash Flow from Financing Activities
Net
Increase in Cash
Beginning
Cash Balance
Ending Cash
Balance
Selected financial statement information and additional data for Stanislaus Co. is presented below 2017 $64,200 143,800 Cash Accounts receivable (net) Inventory Land Equipment TOTAL 2016 $41,610 85,190 168,040 55,130 508,180 $858,150 203,770 18,620 791,360 $1,221,750 $81,340 $113,560 Accumulated depreciation Accounts payable Notes payable - short-term 85,250 50,590 66,800 29,460...
Determining Net Income from Net Cash Flow from Operating
Activities
Curwen Inc. reported net cash flow from operating activities of
$196,600 on its statement of cash flows for the year ended December
31. The following information was reported in the Cash Flows from
Operating Activities section of the statement of cash flows, using
the indirect method:
Determining Net Income from Net Cash Flow from Operating Activities Curwen Inc. reported net cash flow from operating activities of $196,600 on its statement...
Determining Net Income from Net Cash Flow from Operating Activities Curwen Inc. reported net cash flow from operating activities of $227,600 on its statement of cash flows for the year ended December 31. The following information was reported in the "Cash flows from operating activities" section of the statement of cash flows, using the indirect method: Decrease in income taxes payable $4,100 Decrease in inventories 10,300 Depreciation 15,900 Gain on sale of investments 7,200 Increase in accounts payable 2,900 Increase...
Most questions answered within 3 hours.
-
Is the globalization of health care good or bad for patients?
Who might benefit from the...
asked 1 minute ago -
Is the dissolution of the salt A(OH)2 a reaction that increases
the disorder, or decreases the...
asked 2 minutes ago -
A new president at Big State University has made student
satisfaction with the enrollment and registration...
asked 2 minutes ago -
Edwards and Bell market a single line of home computer, dubbed
the XL-98. The master budget...
asked 2 minutes ago -
Given the following list of objects and a fixed bin size of
70:
L = [16,...
asked 27 minutes ago -
A mixture of 0.500 mols of NO and 0.100 mols O2 are combined in
a 5...
asked 23 minutes ago -
A city contains 150,000 people (80,000 females and 70,000
males), and 1,500 people die per year...
asked 21 minutes ago -
A certain weak base has a Kb of 8.80×10−7. What concentration of
this base will produce...
asked 24 minutes ago -
Suppose that the average U.S. household uses 12100 kWh
(kilowatt‑hours) of energy in a year. If...
asked 32 minutes ago -
Patterson Company operates three segments. Income statements for
the segments imply that profitability could be improved...
asked 31 minutes ago -
In 20 words or less, what aspect of your degree course are you
passionate about? civil...
asked 43 minutes ago -
Learning Goal: To understand the relation between the strength
of an acid or a base and...
asked 44 minutes ago