-Does it make sense for a company's first month of operation to have: negative operation activities,...

-Does it make sense for a company's first month of operation to have: negative operation activities, investing activities and positive financing activities? why?

-The same company has an EPS of 0.2, what does that mean for the company's performance?

Solutions

Expert Solution

Yes it makes sense for a company’s first month of operation to have negative operating activities cash flow and positive financing activities cash flow

A Company’s first month of operation can have negative cash flow from operating activities if there are no sales. Cash flow from operating activities is of main core activities of the firm. So if there are no sales there will be no operating cash flow. If expenses are incurred like employees salaries, administration cost, etc it will be negative cash flow from operations

Positive financing activities is due to contribution of capital which will be financing inflow and hence it will be positive

The EPS of 0.20 is nominal which may be due to other income generated during the year. This EPS is not significant from company’s point of view

ekkarill92 answered 1 year ago

Next > < Previous

Related Solutions

Why does it not make sense for a function to have more than one output for...

Why does it not make sense for a function to have more than one output for the same input? Provide examples. First , define inputs and outputs ( independent and dependent variables) . Then, define ordered pairs and relations and give examples. Finally, define a function and talk about what particular type of relation is a function. Can you find a real world relation that is not a function? For example: The age of a person is the input and...

Does it make sense to have an auto industry in Australia? Why did the industry fail?

1.Since they have already paid for their tickets, it does not make economic sense for fans...

1.Since they have already paid for their tickets, it does not make economic sense for fans to leave before a game is finished. true/False 2. (Problem 3a). Bruno can spend his income on two different goods: smoothies and energy bars. For each of the following three situations, decide if the given consumption bundle is within Bruno's consumption possibilities. Then decide if it lies on the budget line or not. Smoothies cost $2 each, and energy bars cost $3 each. Bruno...

1. In CRISPR, why does it make sense to design our crRNA first before making any...

1. In CRISPR, why does it make sense to design our crRNA first before making any other changes to the genomic DNA? 2. In CRISPR, when searching for PAMs, GGNGG makes a much better PAM than NGG - why is this?

Does it make sense to calculate the median for nominal variables?

Read the following scenario and explain why it does or does not make sense (this is...

Read the following scenario and explain why it does or does not make sense (this is a true / (false) question with explanation): I have a cough, sore throat, fever, and chills. go to the doctor and testing shows have influenza. Last time I had these symptoms, had strep throat and my doctor prescribed antibiotics. My symptoms went away quickly! I am sure that if I take antibiotics this time, my symptoms will go away.

a) In what kind of industries does a localization strategy make sense? b) When does a...

a) In what kind of industries does a localization strategy make sense? b) When does a global standardization strategy make most sense? c) Explain the transnational strategy. d) Analyze the different strategies P&G has gone through. e) Explicate the strategies MTV has gone through, since it began selling abroad

Question