Purchase Solution

Sales effect on cash position

Not what you're looking for?

Ask Custom Question

Explain to Xtreme Toys® management how rising sales could cause a decrease in the company's cash position and provide three specific recommendations to management on ways to reduce the cash gap.

Purchase this Solution
Solution Summary

The solution discusses sales effect on cash positions.

Solution Preview

Decrease in cash position means increase in cash outflow is more than increase in cash inflows. The rising sales could cause a decrease in the company' cash position as it lead ...

Purchase this Solution
Free BrainMass Quizzes
Situational Leadership

This quiz will help you better understand Situational Leadership and its theories.

Team Development Strategies

This quiz will assess your knowledge of team-building processes, learning styles, and leadership methods. Team development is essential to creating and maintaining high performing teams.

Organizational Behavior (OB)

The organizational behavior (OB) quiz will help you better understand organizational behavior through the lens of managers including workforce diversity.

Production and cost theory

Understanding production and cost phenomena will permit firms to make wise decisions concerning output volume.

Social Media: Pinterest

This quiz introduces basic concepts of Pinterest social media

View More Free Quizzes
Related BrainMass Solutions

  • Effect on cash position

    169217 Effect on cash position Indicate whether the following corporate actions Increase, Decrease, or cause no change to the cash position. ? Cash is paid for raw materials purchased for inventory ? A dividend is paid ?

  • Credit policy and company risk

    If a company reduces its DSO without seriously affecting sales, what effect would this have on its cash position (1) in the short run and (2) in the long run?

  • Dinesh Patel of Davidson Enterprises

    In reality, Patel probably will be fine by bringing more cash into the company. This response analyzes the behavior of the sales manager of Davidson Enterprises and his effect on the company's financial statements.

  • Finance Questions

    169236 What would be the probable effect on a firm's cash position of the following events? 1.What would be the probable effect on a firm's cash position of the following events? a. Rapidly rising sales b.

  • Statement of Cash Flows versus the Income Statement

    It shows how much money came into the company as revenue and how much money spent as expenses and the net effect of sales and expenses. The net effect will be profit or loss.

  • Credit Policy

    *** If the company reduces its receivables without adversely affecting sales, what effect should this have on the company's cash position (1) in the short run and (2) in the long run?

  • Effect of Operating Leverage on Company's Risk Position

    37250 Effect of Operating Leverage on Company's Risk Position Describe how expanding the division with the highest operating leverage would affect the company's risk position.

  • Working Capital Case Study for the McDonald's Corporation

    The investments from these assets would provide annual returns and which in effect would increase the cash flow and the working capital position. I also suggest the company to increase the credit sales.

  • Ethical Issues with Modifying Financial Statements

    What effect will reclassifying the investments have on the current ratio? Is XYZ's true financial position stronger as a result of reclassifying the investments?

View More Related Solutions