Cash Flow Projections

With the purchase of any fixed asset such as equipment, we need to estimate the profits (more precisely, cash flows) that the asset will generate during its service period. An inaccurate estimate of asset needs can have serious consequences. If you invest too much in assets, you incur unnecessarily heavy expenses. Spending too little on fixed assets also is harmful, for then the firm's equipment may be too obsolete to produce products competitively and without an adequate capacity you may lose a portion of your market share to rival firms. Regaining lost customers involves heavy marketing expenses and may even require price reductions and/or product improvements, all of which are costly. We will begin this section by giving an overview on how a company determines its operating profit.

Project Management Made Easy

Project Management Made Easy

What you need to know about… Project Management Made Easy! Project management consists of more than just a large building project and can encompass small projects as well. No matter what the size of your project, you need to have some sort of project management. How you manage your project has everything to do with its outcome.

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