Podcast
Questions and Answers
Why is managing cash flow crucial for a business?
Why is managing cash flow crucial for a business?
- To ensure a constant fluctuation in available funds
- To increase average costs through missed opportunities
- To meet daily financial requirements (correct)
- To prevent banks from imposing high interest rates
What is the most common cause of business failure according to the text?
What is the most common cause of business failure according to the text?
- Missed opportunities for bulk buying
- Expanding the business too quickly
- Negative cash flow (correct)
- Delayed payments to suppliers
How does negative cash flow impact a business's relationship with suppliers?
How does negative cash flow impact a business's relationship with suppliers?
- It increases the credit period for future orders
- It leads to a reduction in interest charges
- Suppliers may reduce the length of the credit period (correct)
- It ensures a constant supply of stock
Why is it difficult for a business with uncontrolled cash to take advantage of bulk buying?
Why is it difficult for a business with uncontrolled cash to take advantage of bulk buying?
What happens if a business borrows from banks to cover cash shortages?
What happens if a business borrows from banks to cover cash shortages?
Why is it important for a business to ensure there are sufficient funds when taking on a special order?
Why is it important for a business to ensure there are sufficient funds when taking on a special order?
What is one way a business can improve cash flow according to the text?
What is one way a business can improve cash flow according to the text?
What does factoring involve in relation to cash flow management based on the text?
What does factoring involve in relation to cash flow management based on the text?
Which strategy is suggested in the text for controlling stock losses to improve cash flow?
Which strategy is suggested in the text for controlling stock losses to improve cash flow?
What can help businesses keep cash in the business, according to the text?
What can help businesses keep cash in the business, according to the text?
How can a business manage outflow of cash according to the text?
How can a business manage outflow of cash according to the text?
What is a possible consequence of a business being short of working capital?
What is a possible consequence of a business being short of working capital?
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