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Business Finance Assignment - Uber Tools Ltd

   

Added on  2020-10-22

12 Pages3110 Words173 Views
Business Finance
Business Finance Assignment - Uber Tools Ltd_1
Table of ContentsINTRODUCTION...........................................................................................................................1PART 1 ..........................................................................................................................................1a. Profit & cash flow and how it is different................................................................................1b. Working capital, receivables, inventory & payables...............................................................2c. Changes in working capital affect cash flow...........................................................................2ii. Apply the concepts .................................................................................................................3iii. Analyse and recommendation to improve this company’s cashflow through better WorkingCapital management.....................................................................................................................3PART B............................................................................................................................................4a. Elements of financial performance .........................................................................................4b. Calculate ratios.........................................................................................................................6c. Ratios might have changed using the information in the scenario..........................................7ii. Analyse & recommend how the board might assess the financial performance of thebusiness ......................................................................................................................................8CONCLUSION ...............................................................................................................................8REFERENCES................................................................................................................................9
Business Finance Assignment - Uber Tools Ltd_2
Business Finance Assignment - Uber Tools Ltd_3
INTRODUCTIONTo start a business finance is most essential because it provide help to run the firmeffectively. An organisation can arrange the funds through various sources which involves equityand debt. To conduct the operational activities and functions, finance is very important and it ishelpful to expand the business of corporation. Finance source & financing decisions can directlyor indirectly influence the company's liquidity & profitability position. This report discuss aboutexplanations about profit & cash flow and meaning of receivables and working capital. Inventory & payables, how changes in working capital influence cash flow in context toUber Tools Ltd which owns & operates a factory in Newmarket producing power tools. PART 1 a. Profit & cash flow and how it is differentThe amount of incoming and outgoing of cash is known as cash flow which representsthe operating activities of a corporation. Profits are the surplus remaining after total cost hasdeducted from total revenue and after calculating it tax has computed. If a company is earningmore profits than chances of growth can be maximize (McLean and Zhao, 2014). Differenceamong profits and cash flow are mention as: Profit Cash FlowIt is the money left over from sales revenueonce costs has been subtracted. Cash flow reflects the money form distinctsources. Profit is computed before the money isreceived. It can be affected by the timing of paymentsinto and out of business. Sales made beyond a BEP (Break even point)The strength of company can be reflect throughit that how much flow of cash it have. With the help of effective cash flow management UberTools Ltd does not face theproblem of shortage of funds so that operations of company can run smoothly. If corporation isable to generate enough profits than business of organisation can grow and the operating profitbefore interest & tax is £36 million. 1
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