Cash cow

to increase 2% annually. 6. Rent expense is expected not to increase for the first five years. 7. The first year of operation 2016, will be completed using a 10-month period following the time table presented in page 4. 8. All expenses are paid in cash basis. 9. Retainer's fee…

According to the estimates available, Arvind will sell approximately 80 million metres of fabric (includes domestic value-added and plain fabrics as well as exports) for the year 1997-98. This is an increase of 8.92 per cent over the last year when it sold approximately 74 million metres of fabric. The trouble is that this growth is too less. Its sales forecast and viability required it to function at 80 per cent of the built-up capacity. That meant an output of at least 100 million metres (of…

INTRODUCTION A dividend decision policy of a firm is a crucial area of financial management. The importance of a dividend policy is to determine the amount of earnings or profit made by the company to be distributed to shareholders and the amount to be retained in the firm. The amount retained is called retained earnings this are the most significant internal sources of financing the growth of the firm. On the shareholder side dividends are considered desirable because they may increase the…

of a reward that is separate from the act itself. The most common example is financial payment for services rendered. Research often concludes that intrinsic motivation is much more useful for motivating creativity and innovation than extrinsic motivation. In fact some authors (Amabile, 1997; Fernandez and Moldogaziev, 2012) suggest that extrinsic motivation, especially in the form of rewards for short-term performance, can result in a narrower view of the task and can cause employees to avoid…

2. Statement of changes in Financial position It includes a Funds Flow Statement and a Cash Flow Statement. Funds flow statement shows the sources and applications of cash and cash equivalents during a period. Objectives of preparing a Financial Statements (i) To present a true and fair view of the financial performance (i.e. profit/ loss) of the business. (ii)…

QUESTION 2 2.1 Discuss the THREE key functions of money in an economy. Mohr P. and associates, (2015), indicates that money serves as an important part of our everyday life. Money is any good that is widely accepted in exchange of goods and services, as well as payment of debts. The 3 Key functions of money in an economy can be described as follows: 1. Medium of exchange can be defined as money that is used for buying and selling goods and services and if there was no money, goods would…

Opportunity Cost Opportunity Cost: what one gives up when choosing between options. This can be money, but it can also be an intangible asset such as happiness. The financial portions of opportunity cost can be calculated, but the intangible costs need to be taken into account as well. Opportunity cost is important because it takes into account what one gives up and what one gains in different scenarios, and helps inform decisions. I could attempt to become a musician. I would follow my high…

1.0 Introduction CVP also known as Cost-Volume Profit analysis is a method used to calculate and determine break-even point of cost and volume of goods in a business and for management control (Kim Tan, 2011). This is better known as when total revenue equals to total costs and managers find this analysis useful when determining short-term business descisions. When a company hits break-even point, there will be no profit and no losses. Break-even is what most new start up companies want to…

There are two variants of the DCF valuation: the equity valuation and the firm valuation. In fact, we can either use the free cash flow to the firm (FCFF), which is the after-tax cash flow that accrues from the firm's operations, net of investments in capital and net working capital, or we can use the free cash flow to equity (FCFE) that is the cash remaining after a firm meets all of its debt obligations and provides for necessary capital expenditure. Discounting the FCFF at the cost of capital…

the dividend decision and are based on the perfect market assumptions. 2) The Residual Theory This theory hold the fact that all dividend paid are residual, after the firm has retained cash for available investments and positive NPV projects. This being said it was seen that dividend being only the residual cash available cannot be a factor in movement of share…