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    Profits and Cash Flow & Budgets

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    Please help me with the following questions. I need more insight.

    1. What is the difference between profits and cash flow?
    2. Why can a company outgrow its cash?
    3. What is the relationship between profit margins and growth capacity?

    And:

    1. Who should be involved in the development of the budget?
    2. Why is it important to have management approval of a budget?
    3. To what extent does the budget serve as a goal and to what extent does the budget serve as a roadmap for management?

    © BrainMass Inc. brainmass.com October 9, 2019, 6:58 pm ad1c9bdddf
    https://brainmass.com/business/cash/profits-and-cash-flow-budgets-103889

    Solution Summary

    This solution explains the difference between profits and cash flow, and what a company can do to outgrow its cash. It also discusses the relationship between profit margins and growth capacity. It also discuses who should be involved in the development of the budget and why it is important to have management approval of a budget. Finally and by example, it examines to what extent the budget serves as a goal and to what extent the budget serves as a roadmap for management. Research validated, with references provided.

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