Monthly cash budgets of inflows and outflows are an important part of the budgeting process in...
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Monthly cash budgets of inflows and outflows are an important part of the budgeting process in most organizations. During the preparing of a cash budget, the organization must estimate its cash inflows from credit sales. Suppose that in response to a projected cash shortfall (not enough cash to pay amounts owing to suppliers), the organization decides to speed up its collection of credit sales (the amount that is owed to the company by its customers). What effect can this have on the organization? Don't forget to leave a question at the end of your discussion for your peers and for your peers to respond at least once to your question. Monthly cash budgets of inflows and outflows are an important part of the budgeting process in most organizations. During the preparing of a cash budget, the organization must estimate its cash inflows from credit sales. Suppose that in response to a projected cash shortfall (not enough cash to pay amounts owing to suppliers), the organization decides to speed up its collection of credit sales (the amount that is owed to the company by its customers). What effect can this have on the organization? Don't forget to leave a question at the end of your discussion for your peers and for your peers to respond at least once to your question.
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It is true that tightening credit terms will speed up collection but on other hand decreasing ... View the full answer
Related Book For
Management Accounting Information for Decision-Making and Strategy Execution
ISBN: 978-0137024971
6th Edition
Authors: Anthony A. Atkinson, Robert S. Kaplan, Ella Mae Matsumura, S. Mark Young
Posted Date:
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