Corporation with Lots of Cash

Corporation with Lots of Cash Essay example
Ph.D.
Essay
Finance & Accounting
Pages 3 (753 words)
Download 0
Corporations with Lots of Cash It is quite unusual for an economy such as the United States who is still struggling to recover from an economic slump yet it has as much as $ 2 trillion in cash sitting in the private sector. If we are going to use Obama’s Stimulus Package as a benchmark which has saved and created over a million jobs with a mere $787 million, that $2 trillion dollars could have created over 3 million jobs…

Introduction

The doubt about the economic recovery is even more compounded with the recent development of Standard and Poors’ credit downgrade of United States from triple A credit rating to just double A. With how things are going, it is still not likely that the non-financial sector will be freeing that cash for reinvestment. To better understand why these companies are conservative with their spending, we have to consider the lessons they learned from the past financial crisis. Beginning with the dot com bust in 2000, companies with more cash were able to weather the crisis better than cash strapped companies hence is this conservative attitude. The same conservative attitude also helped them withstood the crisis when the recession broke in late 2007 and the eruption of financial crisis in 2008. Companies that were more liquid were able to get through the storm as they do not have to resort to lending which were not available then. ...
Download paper
Not exactly what you need?

Related papers

Cash and accrual accounting
Meanwhile, accrual basis is accounting techniques that transactions are recognized when item is delivered, and revenues are recorded when they are earned. Although, the two methods are both accounting method and used to record transactions, they are different in various ways and the paper will evaluate the difference of the two accounting methods used to recognize transactions. Cash vs. accrual…
Internal Cash Control
On the other hand, both the purchasing agent and treasurer issue check disbursements for expenses without each other’s accountability there is a likelihood of fraud taking place because only one person grants authority for payments. Q4.5 (b) memo indicating recommendations for improving company procedures From: Your NamesXXX To: Idaho Company Management Subject: Internal Cash Control Weaknesses…
CASH FLOW
Net earnings plus added back depreciation have contributed to the bulk of cash flow from operating activities, amounting to 3,883+1,682= $5,565 million. Increases/decreases in inventory, receivables, accounts payable, and other miscellaneous items have contributed the remaining $1,068M. Thus the increase has come mostly from the profits earned during the year. …
S Corporation vs. Corporation
Incorporating as either of these provides shareholders with a number of tax and non tax advantages, which are gained by any company that is incorporated in either of these categories. Focusing on the tax issue, there is the fact that corporations are able in certain situations to help one in reducing their tax obligations. In states where the corporate tax is lower than individual income tax, one…
Statements of cash flows
This explains why bank overdrafts are not part of financing activities. Additionally, the information presented on cash flow of IFRS is quick and easy to flow. Each entity is supposed to present cash flow statement in such a way that it gives an appropriate reporting of financing activities, investing, and operating. For instance, during the investing activities, it is expected that the firm…
Cash and Working Capital
These four phases consist of the following management requirements; cash management which is identifying the cash balance available to run the day to day expenses of the business or firm so as to reduce the cash holding costs (Padachi, 2012). Inventory management is identifying the inventory levels that will enable the business to run smoothly without investment in raw materials. This requires the…
cash Flow
Yum Brands Inc. operates six in different segments including YUM Restaurant International, Pizza Hut (US), Taco Bell (US), KFC (US), A&W All American Food Restaurant (US), YUM Restaurant China and LJS Long John Silver’s (US). This paper comments on the difference between net cash provided by operating activities and net income by speculating on which is likely to be superior sign of…