Cash flow statement-cost-volume-profit measures risk

Assignment Help Managerial Accounting
Reference no: EM1347267

1. Online financial databases, like Lexis/Nexis and the Dow Jones News Retrieval Service, give data on thousands of companies. Assume you want to compare some companies' recent earnings histories. You may have the computer compare companies' returns on stockholders' equity. The computer could then give you the names of the 20 companies with the highest return on equity. You can use any ratio that is relevant to a particular decision. How do financial principles affect financial statement analysis?

2. The analysis of cash flow statement is an important aspect of determining the health of a company. There are questions that need to be asked when you look at a cash flow statement that include:

a. Where is most of the company's cash coming from?
b. Do high sales and profits translate into more cash?
c. If sales and profits are low, how is the company generating cash?
d. Pick one of these questions and tell me why ask the question? What does the answer tell us?

3. Cost-volume-profit (CVP) analysis is used to determine how changes in costs and volume affect a company's operating income and net income. In performing this analysis, there are several assumptions made, including:

- Sales price per unit is constant.

- Variable costs per unit are constant.

- Total fixed costs are constant.

- Everything produced is sold.

- Costs are only affected because activity changes.

- If a company sells more than one product, they are sold in the same mix.

- How do we use CVP analysis to measure risk?

Reference no: EM1347267

Questions Cloud

Java program to print strings given at command line : Write down program Average.java to print strings which it is given at command line, one per line. If nothing is given at command line, then print "No arguments".
Where is the image of the candle : The minimum distance required to stop a car moving at 34 mi/h is 42 ft. What is the minimum stopping distance for the same car moving at 64.0 mi/h, assuming the same rate of acceleration.
Explain is a high degree of market concentration a boon : Explain is a high degree of market concentration a boon or threat to consumers. What is the strongest argument on either side.
Show the motivation and conflict management : Show how different organizations apply motivation theories to motivate employees and examine which conflict management approaches work best in the organizations
Cash flow statement-cost-volume-profit measures risk : Online financial databases, like Lexis/Nexis and the Dow Jones News Retrieval Service, give data on thousands of companies. Assume you want to compare some companies' recent earnings histories. You may have the computer compare companies' returns ..
Elucidate does the coffee market meet all six conditions : Is the market for coffee perfectly competitive. Elucidate does the coffee market meet all six conditions of a perfectly competitive market.
Determination of portfolio standard deviation : Suppose you own a portfolio that has 35 percent invested in asset A, and 65 percent in asset B. Asset A's standard deviation is 12 percent and asset B's standard deviation is 18 percent.
Java program for line item application : This exercise explains you the process of testing and enhancing Line Item application. Open LineItemApp, Validator, Product, LineItem, and ProductDB classes that are in the c:java1.6ch06LineItem directory and review this code.
Business ethics-shareholder vs stakeholder : Describe and critiquing the two most prominent approaches to the nature of Business: shareholder and stakeholder theory and find these approaches both from a theoretical point of view and from a practical point of view.

Reviews

Write a Review

Managerial Accounting Questions & Answers

  Discussion of normal costing system

When using a normal costing system, manufacturing overhead is applied using the ______________ manufacturing overhead rate and the _______________ quantity of allocation base.

  Discuss the ethical issues

Discuss the ethical issues

  Journalize the treasury stock transactions

The corporation sold 1,200 shares of treasury stock for cash at 72 per share. Journalize the treasury stock transactions.

  Describe the cost flow in job order costing system

The three product cost elements?direct materials, direct labor, and overhead? Flow through job order costing system in structured, orderly fashion. Specific accounts and subsidiary ledgers are employed to verify and record cost information.

  Evaluate direct materials and conversion costs

What are the corresponding units for direct materials and conversion costs, correspondingly, for June?

  Activity-based costing and management

Mattresses-A-Million produces Pillow-Top mattresses. They have been using a volume-based costing system to allocate overhead based on direct labor-hours. The Pillow-Top requires two hours of direct labor.

  Manage budgets and financial plans

Explain the budgeting process and its importance to a business, identifying the components of different budgets, forecast estimates for inclusion in the budgets.

  Websites-market segment

Detailed solution outlines market segment which visits candystand.com and describe how to estimate the target audience.

  Cash and investments of a bond sinking fund

Cash and investments of a bond sinking fund established to service general government long-term debt.

  Describe to margaret the normative ethical theories

Describe the key historical events up to 1900 that have shaped the development of accounting. How do these events support the notion accounting is socially constructed?

  Jackson construction company-job order costing system

Jackson Construction Company uses a job order costing system. In May 2008, Jackson made a $1,650,000 bid to build a pedestrian overpass over the beach highway in Gulfport, Mississippi.

  Contribution margin examined by market segment

Why would a business like UPS or eBay be concerned with looking at contribution margin by market segment? Can you recognize kinds of market segments?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd