Abc Company Essay

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The purpose of any business is to make a profit. It may sound simple, but there are many factors that contribute to keeping a business thriving. In today’s economic world, the business world has tougher obstacles to overcome. The key to the success of any business is the ability strategically plan, analyze, and create new opportunities that prove to be profitable. Creativity and innovation are also essential in order for a business to stay ahead. As corporate controller of ABC Company, I am to analyze the company financials in order to assess if the CEO’s idea of adding a new product line will indeed be profitable.
Risk Profile for the Company ABC’s current annual sales of $1.2 million have shown a 25% increase over last year. It is also …show more content…

The net change represents the increase or decrease to cash during a period and should serve to reconcile the change from the beginning- of-period to end-of-period cash balances” (Principles of Accounting, 2012, sec. 1.1). The following information can be taken from the cash flow statement.
• The cash flow statement is utilized to determine the company’s sources of cash flow and where the cash is spent over the last year. In this case, non-cash items are not part of the calculation in order to get a look at the true financial health of the company. o The results of operating activities are a surplus of $180,000 in cash. This has been invested to acquire capital assets of $100,000 for future expansion purposes. Also, in order to satisfy the shareholders, $100,000 of dividends has been paid out. The company has an opening remaining balance of $70,000, which resulted in the ending cash balance of

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