Give two suitable reasons why business can be profitable, Ask an Expert

Accounting

Q1)a. If you could choose single source of cash for your business, what would it be? Describe why?

b. How can business earn large profits but have small balance in Retained Earnings?

c. How can business lose money for many years and yet have plenty cash?

d. Give two suitable reasons why business can be profitable for many years and yet have a cash shortage?

e. Assume your business has $80,000 worth of liabilities which should be paid within next three months. Your liquid (can be turned into cash quickly) assets total only $60,000, your sales and collections from customers are slow. Recognize two ways to finance remaining $20,000 you will require, so you can pay all of liabilities when they are due.

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M916593

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