Principles of managerial accounting. Answers to Questions. (Cash Flows Essay

Principles of managerial accounting. Answers to Questions. (Cash Flows Information, Apples Cash Flow, Stock Features, Role of Management accounting system etc.) - Essay ExampleAs a rule, one should look at cash flow statement, as if the cash obtained from operating activities is greater than the derived net income, company is in a healthy position, but if it is inform otherwise, something is wrong, and management should be concerned on this. (Accounting Coach)It is different for investors because for investors more cash culmination in representation increases in dividends, opportunities for expansions, and payment of debts, and would make better stockholders value. Apples Cash FlowReview the cash flow statement for Apple. How would you summarize Apples cash flow position and what does this statement tell you about where the money is coming from and where its going? What should Apple do to improve its cash position and why? A fall over of the yearly cash flow statement of AAPL from 2010 to 2012 shows that the cash used for operating have been larger than the describe income so it is assumed that some strategies of the company be not attuned with the operations and investing activities. (Yahoo Finance, 2013) For instance, a cud of cash argon tied up in accounts receivables and in heavy investments. AAPL cash flow states Investors are happy since dividends are paid regularly and dutys are met as they fell due.What should Apple due to improve its cash position? Since cash position has been low for the past 3 years of operation, a palingenesis of companys strategies should be done, more so in operational strategies. For instance, heavy accounts receivables means creditors are enjoying too much liberal credit facilities, or management needs to slow down on investments. 3. Stock Features What is birdcallable preferred stock? Why do corporations issue such stock? assumption the different features that are associated with stock (callable, cumulative, prefer red, etc.), what type of stock would you want to buy personally and why? A callable preferred stocks are stocks issued by a company wherein it has the right but not an obligation to repurchase the stock at a specific price after a certain eon (Investing Answers). For instance, issuer Company Star issued preferred stock in 2000, paying a rate of 10% and would originate in 2020 , callable at 2010 . In 2010, Star gains the right to call the stock. Star would most believably exercise its right to call the option if the involvement rates in 2010 is lower than 10%. The mutual procedure is that issuer pay investor a little over the par value in order to call the stock, a call known as call premium. Call premium decreases as the preferred stocks comes roughly to it maturity. In this case Star offers 102% of face value if the call is done in 2010, but it is reduced to 101% as it goes to 2015 or nearer. It is advantageous to issuer since it can offer the flexibility of offering lower in terest rates thus gain in the transaction. A callable preferred stock becomes disadvantageous to investors because of prospects of reinvesting at a lower rate of interest. Cumulative refers to the variation in the preferred stock. This provision settles any amateurish dividends in the past to the investor before paying new obligations to investors. It is cumulative because company owes investors a collective add up (Damon, S.). Preferred Stock is a financial instrument that gives the investor a higher claim on the assets and compensation of the company than the holders of common stock. Dividends must be paid