Purchase Solution

Cash vs. Profit as King

Not what you're looking for?

Ask Custom Question

Agree or disagree. Why?

Cash -- Not Profits -- is King. In measuring value we will use cash flows rather than accounting profits because it is only cash flows that the firm receives and is able to reinvest.

Purchase this Solution

Solution Summary

Referring to the fact that in measuring value we will use cash flows rather than accounting profits because it is only cash flows that the firm receives and is able to reinvest, this solution debates the statement: Cash -- Not Profits -- is King.

Solution Preview

Please see response attached (also below) I hope this helps and take care.

RESPONSE:

Agree or disagree. Why?

Cash -- Not Profits -- is King. In measuring value we will use cash flows rather than accounting profits because it is only cash flows that the firm receives and is able to reinvest.

Response:

Although there are opponents on both sides, there is some compelling evidence to support this statement. Why? When planning the short- or long-term funding requirements of a business, for example, it is more important to ...

Purchase this Solution


Free BrainMass Quizzes
Basics of corporate finance

These questions will test you on your knowledge of finance.

Academic Reading and Writing: Critical Thinking

Importance of Critical Thinking

Transformational Leadership

This quiz covers the topic of transformational leadership. Specifically, this quiz covers the theories proposed by James MacGregor Burns and Bernard Bass. Students familiar with transformational leadership should easily be able to answer the questions detailed below.

Organizational Leadership Quiz

This quiz prepares a person to do well when it comes to studying organizational leadership in their studies.

Change and Resistance within Organizations

This quiz intended to help students understand change and resistance in organizations