...CHAPTER 16 WORKING CAPITAL POLICY AND SHORT-TERM FINANCING ANSWERS TO QUESTIONS: 1. The need for working capital arises because the normal operating cycle of the firm requires that expenditures for raw materials, labor, etc. be made prior to receipt of the funds from the sale of the output. Funds must be invested during the operating cycle in the various short-term assets that make up working capital--namely, cash, inventories, and accounts receivable. 2. The operating cycle represents the length of time involved in purchasing raw materials, manufacturing the product, and distributing (selling) the product. The cash conversion cycle represents the net time interval between the collection of cash receipts from sales and the cash payments for the various resources used by the firm. The operating cycle is equal to the sum of the inventory conversion period and the receivables conversion period. The cash conversion cycle is equal to the operating cycle less the payables deferral period. 3. A relatively large investment in working capital results in lower expected profitability and lower risk for the firm. The rate of return on current assets is normally less than the rate of return on fixed assets and hence a relatively large investment in current assets lowers the overall rate of return on the total assets of the firm. However, a relatively large investment in current assets also increases the working capital position of the firm...
Words: 6966 - Pages: 28
... help or REGISTER NOW! Bottom of Form |Essay Forum / Writing Feedback / | | | | | 'The Advantages and Disadvantages of Globalization' Top of Form syahid Apr 9, 2010, 10:03am #1 Even though globalization affects world's economies in a positive ways, its negative side should not be forgotten. Discuss. Globalization has contributed a lot to the world today. It boosts countries economies, advance technologies and improve daily life of the people. But in the meantime whether it is a blessing or a curse has sparked much debate. This is because the benefit of globalization always come with the drawbacks. For me, the advantages of the globalization are outweigh its disadvantages. Convincing argument can be made that globalization has led to advancement in technologies. This advancement has built the new world without boundaries. So, the communication can be made with any other parts of the world through technologies such as internet and telephone. Hence, ideas exchange can be done among intellectuals,journalists, scientists or ordinary people. As a result, the best ideas will be spread all over the world which led to enhance the world achievements. However, there are some disadvantages of the globalization. The absence of boundaries of the world through technologies could create harmful to the people. To illustrate, the access to the bad website in internet such as drugs and...
Words: 964 - Pages: 4
...Even though globalization affects the world’s economies in a very positive way, its negative side should not be forgotten. Discuss Globalization is integration of societies, economies, cultures of worldwide through of process of technology, politic and trade. Everything has both advantage and disadvantage, globalization is not an exception. we should considerate both sides. Globalization has some advantage. Firstly, free trade is which a country does not pay a levy taxes on import or export goods or services. Secondly, globalization increase new market around the world, so every companies try to find new market and earn more customer. Consequently, companies compete with each other to provide goods an service with high quality because people have more choice in new market. Finally, Globalization increases' rate of employment because new market need both skilled and un skill labor. And also globalization increases standard of living of people and reduce poverty. Today people we can immigrate to other country or go to another country for education. On the other hand, globalization has some disadvantages. Although, globalization increases employment's rate in new market, meanwhile unemployment's rate increase in developed countries. Companies or factories in developed nation try to establish their branches in poor countries because of low cast labor. Salaries are low and work condition are often bad in poor countries. When people immigrate to other country, they transport...
Words: 252 - Pages: 2
...Questions Part A: 1 Part B: 3, 5 Student Name: Fred Can Zhang Student Number: N7687079 Tutor’s Name: Nino Miletovic Word Count: 3116 Part A Question 1 Introduction Currently, the development of media industries have been significantly motivated by media convergence; globalization and competition. Therefore, how to change and improve to adapt challenges and opportunities which brought by new ages have become a core mission for many media producer and organizations. During these changing process, it is clearly to see that audience’s attitude and preference have always significantly influence industries’ strategies, the organizations who can make the good audience consideration usually can achieve a better performance. However, with the rapid development of new technologies, the audiences becoming elusive – hard to pin down; define; measure and manage. (Lecture Notes, 2015) It has indicated that to consider how can different research methodologies help or affect industries to describe and understand the audiences could be necessary. This essay will discuss 2 types (Quantitative and Qualitative) of methodology which used often to research on audience, to analysis their benefits and disadvantages; make the statements based on examples and give the conclusion. Quantitative survey Research Firstly, quantitative research is a common and useful methodology to research on audience, this methodology has basically include survey research; content analysis and so on. In order...
Words: 3494 - Pages: 14
...Argumentative Essay: Advantages and Disadvantages of Using the Internet Essay topic: Argumentative Essay: Advantages and Disadvantages of Using the Internet Nowadays, the Internet is growing rapidly. Many people open Internet because it assists a lot of benefits for them. However, many people become victims after accessing the internet. In this essay, I will discuss the benefits and dangers of the internet. The internet has many benefits. One of these benefits of Internet is it is the medium of communication. There are many facilities on the internet helps us to communicate each other such as E-mail, Facebook, Twitter and others. All these facilities enable people to communicate with other people from different countries around the world so that it can explore other cultures of different ethnicity. Also, Internet is a medium of information. Today, a lot of people need the information from the internet. Because every second on the internet, updates the information required by humans. For instance, Google and Yahoo are search engine information on the internet that provide all kinds of topics the information we need. Furthermore, Internet is a medium of entertainment. Internet becomes successful because it provides a lot of entertainment that humans need. For example, today many people are watching or downloading free entertainment on the internet, and many people are playing on-line games. In contrary, the internet has a lot of disadvantages. The fact of the matter is that...
Words: 2298 - Pages: 10
...NDU Economic Globalization By : Elias Barakat Instructor : Dr Queen Salame Outline : 1- Introduction , Page 3 2- The effects of economic globalization on developing countries , Page 4 3- Advantages and disadvantages of economic globalization , Page 6 4- History of Globalization , Page 9 5 - Factors Contributing to the Rise of Globalisation in the Early 1980s , Page 11 6- Conclusion , Page 14 Index , Page 14 Introduction: Economic globalization is a worldwide phenomenon wherein countries’ economic situations can depend significantly on other countries. Many allied countries would supply resources to each other that the other countries do not have. These resources can cover imported products, technology, and even human labor. Many people have observed that this phenomenon may lead to a “one-world government,” which consists of a centralized government for all nations. The nature of globalization and global economic change has been a subject of immense academic research during the past two decades. It is more a phenomenon in need of explanations than a universal cause of empirically observable outcomes in the so-called globalization theory.1* 1*Check references page The effects of economic globalization on developing countries 1- Increased Standard of Living : Economic globalization gives governments of developing nations access to foreign lending. When these funds are used on infrastructure including roads, health care, education, and social services...
Words: 1705 - Pages: 7
...Faculty of Business and Accountancy, Graduate School of Business CSGB 6314 INTERNATIONAL BUSINESS MANAGEMENT SEMESTER 2, 2015/2016 ESSAY – Individual Assignment “Globalization brings more benefit than harm and should therefore be encouraged”. Discuss the statement. Submitted to: Prof. Dr. Mohd Nazari Ismail Prepared by: TAN WAN TENG, CGA150015 Date: 5th April 2016 TAN WAN TENG (CGA150015) CSGB 6314 International Business Management Globalization is not a new thing. Long time ago, people have been selling to and buying from each other places at far distances, for example, the Silk Road across Central Asia which was connected China and Europe during the Middle Ages. The globalization has been developing since 1980 and today it is easier for people and firms to communicate with other countries in the world. Globalization is the development of worldwide economy in which resources and products move fairly across national borders. It is also a process of integration among people, companies, and governments of different countries, which is usually driven by international trade, investment and supported by information technology. Both developing and developed countries are taking part actively in globalization process but both countries reacted differently in globalization. This process has the positive and negative effects on employment, culture, education and knowledge, market competition, economic, wealth and human physical well-being around the...
Words: 2531 - Pages: 11
...quality of service. As a result it is necessary to improve the well-being of employees, decrease unnecessary costs, and enhance the competitiveness of the organization. Given this, it is no accident that telecommuting, is one of the largest growing areas, in flexible alternative work schedules. The influence of globalization over all aspects, of many economies, also increases the effectiveness of telecommuting. Now, more than ever, many employees are taking advantage of completing their work in an alternative work environment. Advantages can be tangible, such as reduction in office space, or intangible, such as improved family life. Employee advantages include freedom, decreased clothing expenses, and increased moral. Employers also benefit from telecommuting. Reduced absenteeism, and reduced financial cost, are only two reasons why an employer should consider implementing a telecommuting program. In this paper I will discuss the advantages of teleworking and the disadvantages of teleworking. The questions I will address are: - What are the advantages and disadvantages of teleworking? It is important to carefully evaluate the telecommuting advantages and disadvantages. For motivated individuals who enjoy working independently and are able to focus on work while at home, a telecommuting job can be ideal. For those who perform better with close supervision and opportunities to interact with coworkers regularly, this type of job might not be the best choice. - What are the financial...
Words: 467 - Pages: 2
...Integrative Problems & Virtual Organization Strategy Paper There are mainly three options for expansion when a company is privately held and wants to expand their operation. This paper will discuss three specific options that a privately held company would have if they were to expand. First of those options would be to go public through an IPO or Initial Public Offerings. The second option would be to acquire another organization in the same industry in order to expand the business. The third and final option being to merge with another organization. With all three of these options having strengths and weaknesses, this paper will discuss some of the strengths and weaknesses of each and what opportunities may arise from each approach as well as the threats. Other things that this company may want to consider when looking to expand are the effects of globalization on the company's financial decision as well as the factors that contribute to exchange rate risks. Finally ending the paper with mitigating the exchange rate risk. Going Public through an IPO Taking a business public or better known as participating in an initial public offering is a process where the business is offered to the public by selling stock of the company. In turn, these stocks represent a partial ownership in the company to the individuals that purchase the stock. One common step in deciding whether or not to take a company public it is always best to speak with an IPO consultant to help determine the...
Words: 1357 - Pages: 6
...Abstract Globalization is the buzzword of today. Globalization means bringing the world together, making the world interactive and effective. The economies of the world are being increasingly integrated. It is very debatable issue since it affects every single human being in this earth and plays a major role in every second and in every issue of the entire universe. Mobile phones and Internet have brought people closer. The world is becoming a smaller place. It brings the local market and the global market in a bond which creates new ideas and thoughts to both the market. Goods, which were once confined to western countries, are available across the globe. Work can be outsourced to any part of the world that has an Internet connection. Because of improvements in traffic infrastructure one is able to reach one’s destination in a relatively short span of time. This paper clearly speaks about the impact of globalization and the challenges faced by it in the world. It speaks about the impact in developed and developing countries of the world. Table of Contents CHAPTER 1 5 Definition of Globalization 5 Globalization trend in the past golden years 5 CHAPTER 2 8 Positive impact of Globalization 8 Challenges faced due to Globalization 9 Comparison between Benefits and Challenges 11 CHAPTER 3 13 Impact on developed countries 13 Impact on developing countries 14 Conclusion 15 Case Study 15 References 16 CHAPTER 1 Definition of Globalization As a term globalization...
Words: 3430 - Pages: 14
...Parte superior do formulário Globalization and Cultural Identity 29th August 2014 Globalization is such a commonly used term in the twentiethcentury. It simply means that the world has become integrated economically, socially, politically and culturally through the advances of technology, transportation and communication. In other words, it is the idea that the world is developing a single economy and culture. As mass communication and transport continue to grow societies are becoming more and more alike leading to a phenomenon known as globalization. In this essay the main discuss will be about how globalization has influenced all countries and the advantages and disadvantages about it. It is undeniable that globalization has resulted in both positive and negative effects which must be addressed accordingly. Supporters claimed that globalization has always had a great impact on cultural identity. Today, in an age when discrete cultures themselves are under threat, the question of cultural identity becomes newly problematic and takes on new urgency. The reason for this importance lies in the preservation of the traditional cultures and values that are carefully being forgotten into the globalization. Some people fear that globalization will inevitably lead to the total loss of cultural identity. Differences between countries become less evident each year. Nowadays, all...
Words: 1232 - Pages: 5
...Integrative Problems and Virtual Organization Strategy FIN/370 Integrative Problems and Virtual Organization Strategy In this paper, Team C will discuss Huffman Trucking Company and recommend a strategy that is best for this company and what will benefit the company the most. It will discuss the strategies such as undertaking IPOs, merging with other companies and ways to get other companies, as a way to help their company to branch out. Some of the other things that will be discussed are the benefits and risks, the advantages and disadvantages of all the approaches that should be taken into consideration for what is the best way to strategy for the business, the strengths and weaknesses of each approach, and the opportunities that each one has to give. Finally, the last thing discussed is the globalization on financial decisions, factors of the exchange rate risks, and the mitigation of exchange rate risk. The one thing that Huffman Trucking Company has is strength and they can use this if they decide to go public through the IPO. By doing this Huffman Trucking will be able to raise extra capital for the company. This will then increase the liquidity of the stocks and it will increase the revenue to invest or it could extend the business. This will give the Huffman Trucking Company an opportunity to market the company to the public to extend the company’s service. This strength is to be able to limit their competition. Therefore, this will increase the business’s...
Words: 1080 - Pages: 5
...cross-cultural marriage Nowadays, cross-cultural marriage has become a common trend in society. Globalization, in my opinion, is nevertheless one of the primary causes that contribute to the occurrence of this phenomenon. People in in the world are no longer isolated from their geographical locations and cultures. However, one might ask whether cross-cultural and international marriage always beneficial. In the following paragraphs, I will discuss this is issue in terms of its advantages and disadvantages. From the one side, international marriage can reduce the gap that exist in both cultures. This gap is reduced because people from different cultures and nationalities have opportunity to understand each other in a very objective way. Moreover, understanding other culture will demolish all the negative stereotypes that people perceived in their minds. Furthermore, when people are able to understand one another, i believe it will result to a better and peaceful world. From other side, however, we should also realize the fact that cross-cultural and international marriage can create several problems. In a case where a couple is originated from totally two different cultures and religious beliefs, it can produce conflict, both internal and external. We often see the case where a husband or a wife is being removed from his or her family circle, simply because he or she decided to marry someone who comes from other culture that has strong attachment to certain religious belief...
Words: 324 - Pages: 2
...given individual users in different ages, firms and organizations many usages they did not have before. Along with all these comforts, the Internet can also be an unsafe place if you are not careful. Limitations in ones personal life, temptations and virus threats are some of the dangers. In this text I will discuss the advantages and disadvantages of Internet. It is no secret that the Internet is a helpful tool in people’s daily lives. The computer network has had an enormous increase in traffic and distribution and has more than 3 billion users. This allows people to easily get in touch with each other. Besides, people have access to different sources of information, in almost every thinkable subject. Online services like shopping is one of the offers for whomever that does not take the trouble to stand up and move. The easy click-and-buy way of living is a concerning lifestyle though, as there are ever more ways to be lazy. Downloading software, such as games and movies, is also a benefit of Internet in terms of entertainment, although this can be illegal. A new trend is getting education via Internet, which goes to show how the computer network and the globalization are connected. Internet gives us lots of opportunities and shortcuts in life. Internet is useful, but carelessness can be dangerous. This worldwide tool causes addiction, which makes it easy to waste time. You might not realize it, but as you frequently start using the Internet, you are gradually going to...
Words: 810 - Pages: 4
...What is the internet and how has it effected the lives of many people? Discuss both its benefits and setbacks. Are there more advantages than disadvantages? Present your opinion with explains and example Today, in the era of globalization, the role of Internet has become one of the most important parts in our life. It can be defined as a global system of interconnected computer networks that use the standard Internet Protocol Suite (TCP/IP) to serve billions of users worldwide, it is also considered as a huge electronic library of humanity which contains a lot of information and knowledge. Therefore, it is probably to say that people cannot live without Internet today, however, the Internet has both its advantages and disadvantages. In the positive side, there is one thing that we can see easily is that Internet can be used to communicate people from every part in over the world within a few clicks. As an example, for international student like me, when I want to communicate with my family or my friends, I just use the online chatting system like Yahoo or Skype to talk with them, even we can see each other through video call system. It is more convenient, cheaper and faster than using mobile phone. A part from that, the Internet is very useful for those who like shopping but lazy to go out, it is the online shopping system like Gmarket, this is one of the famous websites in Korea. You can buy anything like clothing, shoes, bags etc. on this website by just clicking and choosing...
Words: 444 - Pages: 2
