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What are the potential consequences of a cash shortfall in an organization?
What are the potential consequences of a cash shortfall in an organization?
- Lowered tax liabilities, increased profit margins, improved cash flow, and higher stock prices
- Reduced employee motivation, delayed project timelines, decreased customer satisfaction, and increased operational costs
- Enhanced employee benefits, expanded production capacity, diversified investment portfolios, and increased market share
- Inability to meet payroll, unpaid suppliers, missed loan payments, and no dividend checks for investors (correct)
What happens if an organization fails to meet payroll due to a cash shortfall?
What happens if an organization fails to meet payroll due to a cash shortfall?
- Employee productivity improves, and operational efficiency increases
- Suppliers offer extended credit terms, and investors provide additional funding
- Employee morale decreases, and legal consequences may arise (correct)
- The government provides financial assistance, and customers increase their orders
Why is managing cash flow crucial for the operation of every organization?
Why is managing cash flow crucial for the operation of every organization?
- It allows for aggressive expansion and high-risk investments
- It is only important for start-up companies and not established organizations
- It primarily benefits the top management and does not affect other stakeholders
- It ensures the ability to meet financial obligations and maintain stakeholder confidence (correct)
Is absolutely crucial to the operation of every organization. If there is ever a cash shortfall, payroll cannot be met, suppliers are not paid, scheduled loan payments will not be made, and investors will not receive dividend checks.
Is absolutely crucial to the operation of every organization. If there is ever a cash shortfall, payroll cannot be met, suppliers are not paid, scheduled loan payments will not be made, and investors will not receive dividend checks.
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