More Humor Refer to numerous humors articles from humor section of my other accounting blog. Humor: Heaven & Hell……..which to you choose? While walking down the street one day a US senator is tragically hit by a truck and dies. His soul arrives in heaven and is met by St. Peter at the entrance. “Welcome … Read more
Managing cash is not a one way traffic of merely sourcing for funds for the company in a timely and cheapest manner. It also involves the calculated and systematic way of investing cash surpluses. It is very important to understand the underlying factors that should be considered when deciding how a company should invest its … Read more
Managing cash is not a one way traffic of merely sourcing for funds for the company in a timely and cheapest manner. It also involves the calculated and systematic way of investing cash surpluses. It is very important to understand the underlying factors that should be considered when deciding how a company should invest its … Read more
Optimizing Working Capital By Cash Management Importance of Cash: Cash is the balancing figures between debtors, stock and creditors. Without adequate cash to meet working capital demands, it is impossible to extend credit, order stock or pay creditors. Managing Cash or Cash management involved the following: efficient banking-making sure money received … Read more
Capital Investment Appraisal Capital Investment appraisal form part of the examination question. To understand it, the student needs to understand basic principles of time value of money, future value of money and present value of money,the different types of investment appraisal and the advantages and disadvantages of the various methods. Article No. Heading 1 Basic … Read more
Optimizing Working Capital By Managing Accounts Payable Trade creditors are the organization’s regular suppliers of goods and services. The business owed money to them and hence is an integral part of the working capital equation. The good thing is that: the higher the amount owed to the trade creditors, the more working capital has been … Read more
Improving Working Capital By Managing Inventories The objective of Managing Stock is to: establish the proper stock control levels so as to ensure that excessive stocks are never carried (and working capital thereby sacrificed) but that they never fall below the level at which they can be replenished before they run out. Failing to maintain proper … Read more
Improving Working Capital By Managing Trade Debtors or Accounts Receivable The management of debtors which is also known as credit management involves: A fundamental trade-off between the cost of providing credit to customers (which includes financing bad debts and administration), and the additional net revenue that can be earned by doing so. Article No. Useful … Read more
Introduction: Basically, there are two types of capital need which comprises the following: Fixed capital to invest in fixed assets like building, plant and equipment which tends not to vary in the short term. Tends only to be volatile when when major investment decisions are made for example when assets are purchased or sold and … Read more
It’s critical to manage the company’s working capital as cash generated from the working capital cycle is not synonymous with profit generated from the business. Without adequate cash/liquidity, profitable companies can not survived as they need to pay their liabilities from cash and not from profit. Some examination questions test the candidates on the understanding, … Read more