Question

Identify and describe two incremental cash flows for project such as expanding a product line or launching a new product or service.

Need 300b words discussion

Answer 1

Incremental cash flows for project such as expanding a product line or launching a new product or service

Meaning of incremental cash flows ---when a company start new project and for that project additional operating cash flow required, this cash flows is known as incremental cash flows.

Two incremental cash flows are:

1. positive incremental cash flow:

* Good indication for business and organization.

* Increase the profitability of business and organization.

* Increase the goodwill and value of business and organization.

* Good sign for company investor.

* Incremental cash flow= Revenue - Expenses. - Initial cost.

( Incremental cash flow have position value)

  

2. Negative Incremental cash flow :

* Its affect the business and organization in negatively.

* Decrease the profitabilit of business and organization.

* Bad indicator for business and organization.

* Decrease the goodwill and value of company.

* Bad sign for investor and affect the company investment plan.

*Incremental cash flow= Revenue - Expenses. - Initial cost.

( Incremental cash flow have negative value)