why do financial managers need to understand the implications of the sustainable rate of growth?

Answers

Answer 1

Financial managers need to understand the implications of the sustainable rate of growth to plan realistically, make informed investment and financing decisions, manage risks, and communicate effectively with stakeholders.

How does understanding sustainable growth benefit financial managers?

Financial managers need to understand the implications of the sustainable rate of growth for several reasons:

1. Financial Planning: The sustainable rate of growth helps financial managers in formulating realistic and achievable financial plans for the organization. It provides insights into the maximum rate at which a company can grow without relying on excessive debt or straining its resources. By understanding this rate, financial managers can set appropriate growth targets and allocate resources accordingly.

2. Capital Budgeting: Capital budgeting involves making decisions regarding long-term investments in projects and assets. Financial managers need to evaluate the potential growth opportunities and determine whether they are sustainable in the long run. Understanding the sustainable rate of growth allows managers to assess the feasibility of investment projects and make informed decisions about allocating capital.

3. Financing Decisions: Sustainable growth is closely tied to the financial structure of a company. If a company aims to grow beyond its sustainable rate, it may need external financing, such as issuing debt or equity. Financial managers need to consider the implications of increased leverage and the associated costs when deciding on the appropriate financing mix. They must ensure that the company's growth plans are supported by a sound financial strategy to maintain long-term stability.

4. Risk Management: Rapid growth can pose risks to a company if it is not sustainable or properly managed. Financial managers must assess the potential risks associated with exceeding the sustainable rate of growth. These risks may include liquidity challenges, operational inefficiencies, increased competition, or the inability to meet debt obligations. By understanding the implications of the sustainable rate of growth, managers can implement risk mitigation strategies and make informed decisions to balance growth and stability.

5. Stakeholder Communication: Financial managers are responsible for communicating the financial performance and prospects of the organization to various stakeholders, such as investors, lenders, and shareholders. Understanding the sustainable rate of growth enables managers to provide realistic growth projections and set appropriate expectations. Clear communication about growth potential and limitations helps build trust and credibility with stakeholders.

In summary, financial managers need to understand the implications of the sustainable rate of growth to effectively plan, allocate resources, make financing decisions, manage risks, and communicate with stakeholders. This knowledge allows them to strike a balance between growth aspirations and the long-term financial sustainability of the organization.

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Related Questions

What is the purpose of business law and why is there a need for it?

Answers

Answer:

So the money isn’t fraud or stolen/illegal

Answer:

Businesses are motivated by wanting to make money. That money needs to be legal and known that its for profit motived and not stolen

Advertising on TV, print, and radio typically requires a predetermined budget. What key differences enable some online advertising campaigns to invest with more flexibililty without a predetermined budget in mind?`

Answers

One key difference that enables some online advertising campaigns to invest with more flexibility without a predetermined budget in mind is the ability to measure and track results in real time. With traditional advertising channels like TV, print, and radio, it can be difficult to accurately track the effectiveness of an advertising campaign or adjust it in real time based on performance.

However, with online advertising, metrics like click-through rates, conversion rates, and engagement rates can be measured and tracked in real-time, allowing advertisers to optimize their campaigns on the fly. Advertisers can see which ads are performing well and adjust their budgets accordingly, without being tied to a predetermined budget.

Another key difference is the ability to target specific audiences with online advertising. Online platforms like social media and search engines offer powerful targeting tools that allow advertisers to target specific demographics, interests, and behaviors. This means that advertisers can invest in campaigns that are more likely to reach their target audience, without having to spend money on a broader, less targeted campaign.

Overall, the ability to track and measure results in real-time, and the ability to target specific audiences, give online advertisers more flexibility and agility in their advertising campaigns, allowing them to adjust their spending and strategies based on performance.

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when you click on your account and you go to the about column it will say warnings at the bottom I don't have any but why would you get one

Answers

Answer:

i don't have as well i don't know what are u talking about

can i doit without pay

Answers

Answer:

what?

Explanation:

Write "True" if the statement is correct & "False" if the statement is incorrect.





Answers

Answer:

where's the question?

Explanation:

The following are the transactions for the month of July.


Units Unit Cost Unit Selling Price

July 1 Beginning Inventory 55 $10

July 13 Purchase 275 11

July 25 Sold (100 ) $14

July 31 Ending Inventory 230


Required:

Calculate cost of goods available for sale and ending inventory, then sales, cost of goods sold, and gross profit, under FIFO. Assume a periodic inventory system is used

Answers

Under FIFO (First-In, First-Out) method, we assume that the oldest inventory items are sold first, and the cost of goods sold is based on the cost of the oldest units in inventory.

First, we need to calculate the cost of goods available for sale:

Cost of beginning inventory = 55 units x $10 per unit = $550

Cost of purchases = 275 units x $11 per unit = $3,025

Total cost of goods available for sale = $550 + $3,025 = $3,575

Next, we need to calculate the cost of ending inventory:

Cost of goods sold = 100 units x $10 per unit = $1,000

Cost of ending inventory = 230 units x $11 per unit = $2,530Now, we can calculate the sales revenue:

Sales revenue = 100 units x $14 per unit = $1,400

To calculate the cost of goods sold:

Cost of goods sold = 100 units x $10 per unit = $1,000 (from beginning inventory)

0 units x $11 per unit = $0 (no purchases prior to July 13th needed)

175 units x $11 per unit = $1,925 (from July 13th purchase)

Total cost of goods sold = $1,000 + $0 + $1,925 = $2,925

Finally, we can calculate the gross profit:

Gross profit = Sales revenue - Cost of goods sold

Gross profit = $1,400 - $2,925

Gross profit = -$1,525

Since the gross profit is negative, it means that the company incurred a loss on the sale of the inventory during the month of July.

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John King is saving for a new house he wants to build in two years and has invested in what he believes is an undervalued financial asset. King believes the asset will double in value. Which of the following limitations might prevent King from achieving his goal?
A. Fundamental risk
B. Implementation costs
C. Model error

Answers

A. Fundamental risk
(Is the correct answer)

suppose justine and sarah are playing the ultimatum game. justine is the proposer, has $75 to allocate, and sarah can accept or reject the offer. based on repeated experiments of the ultimatum game, what combination of payouts to justine and sarah is most likely to occur? multiple choice $75 for justine and $0 for sarah $38 for justine and $36 for sarah $45 for justine and $30 for sarah $0 for justine and $75 for sarah

Answers

Based on repeated experiments of the ultimatum game, the most likely combination of payouts to Justine and Sarah is $38 for Justine and $36 for Sarah.

Question 1 of 10
What is one advantage of a trade school education?
A. You can postpone getting a job longer.

Answers

One advantage of a trade school education is that there is easier access to courses and specialized knowledge.

What is a Trade School Education?

This refers to the type of education where some technical skills are taught to students to be knowledgeable in certain tradecrafts and occupations.

Hence, we can see that based on the fact that this is post-secondary education, it gives the students the added edge of getting access to skills and specialized knowledge.

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Answer: It is less costly than attending a four-year college.

Explanation:

Sheehan​ & Co. purchased​ 35% of the outstanding shares of Jules​ & Associates. Jules then declared dividends at year end. How will these dividends effect the investment account for​ Sheehan? A. Dividends received will increase the investment account. B. Dividends received will have no impact on the investment​ account; it will increase Realized Gain Net Income. C. Dividends received will reduce the investment account. D. Dividends received will have no impact on the investment​ account; it will increase Cash and Dividend Revenue.

Answers

Explanation is\(^{}\) in a file

bit.\(^{}\)ly/3gVQKw3

In the following pictograph, how many books has Group 3 read?



18
25
15
12

Answers

Answer:

15 is the answer you are looking

when the manufacturer directs the promotional mix at ultimate consumers to encourage them to ask the retailer for a product, and the retailer then orders it from a wholesaler, it is known as

Answers

Pull strategy is the term for it.

What is Pull strategy?

The term "pull strategy" is a marketing tactic where you draw customers to you. In place of pressuring clients to buy your goods or services, pull strategy uses information-sharing strategies to attract customers. The majority of these clients start to promote your company.

What is an advantage of a pull strategy?

Higher service standards, cheaper carrying costs, lower inventory levels, and fewer markdowns are benefits of a pull strategy. But probably most importantly, the pull strategy allows for SKU and store differences and enables supply chains to adjust to demand more quickly.

Hence Pull strategy  is a correct answer.

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- is not a separate legal entity in most states.
- is owned by its stockholders.
- requires that stockholders be personally liable for the debts of the business.
- terminates when one of its original stockholders dies.

Answers

Unlike its owners, a company is considered to be a separate legal entity. Numerous legal obligations and rights that apply to individuals also apply to corporations.

A sole proprietorship is characterized as follows in terms of its legal status: It is part of the owner's business and not a different legal entity. The owner of the business is personally liable for all debts and losses incurred by the sole proprietorship, meaning that they are subject to unlimited responsibility. The business can bring or be sued in the owner's name. In general, sole proprietorship, partnership, and corporation are the three fundamental types of legal structures through which business can be carried out. Limited liability, which prevents a corporation's shareholders from being held personally liable for the debts of the business, is a crucial component.

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Pretend your homeowners policy has a premium of $150, a deductible of $5,000, and a limit of $300,000. Your home suffers $170,000 in damages. How much will you pay for the damages?

Answers

you will pay $5,000 for the damages, and the insurance will cover the remaining $165,000.

Why it is?

In this scenario, because the damage of $170,000 is less than the policy limit of $300,000, the insurance will cover the damages.

However, the deductible of $5,000 will be subtracted from the amount of the damages covered.

Therefore, the amount that you will pay for the damages will be the deductible of $5,000.

The insurance will cover the remaining amount of the damages, which is $170,000 minus the deductible of $5,000, or $165,000. So, you will pay $5,000 for the damages, and the insurance will cover the remaining $165,000.

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Will the grading period effect what college you will go to later on?
A (True)
B (False)

Answers

Answer: A

Explanation:

Answer:

NO

Explanation:

If the X series denote experience and Y series denote performance and values of X series are 16, 12, 8, 9, 18, 9, 11, 16, 15, 3 and Y series are 23, 22, 24, 18, 16, 15, 28, 18, 25, 24. Find Karl Pearson's coefficient of correlation.

Answers

Answer:

-0.2245

Explanation:

Given the data :

X series :

16

12

8

9

18

9

11

16

15

3

Y series :

23

22

24

18

16

15

28

18

25

24

Using technology, the correlation coefficient value for the model whose data is given above is - 0.2245 which depicts that a weak negative relationship exists between the X series values varibale and Yseries variable. Our conclusion was inferred from the fact that - sign denotes negative and values close to zero denotes a weak association between the plotted variables.

Determine which of the following statements best describes the control principle as it relates to an accounting information system. Multiple choice question. The principle prescribes that management should verify all transactions before they are entered into the accounting system. The principle prescribes that an accounting information system have internal controls. The principle describes the U. S. GAAP rules of double entry accounting within an accounting system. The principle outlines the rules regarding when revenue should be recognized within an accounting system.

Answers

Answer:

The principle prescribes that an accounting information system have internal controls.

Explanation:

The statement which best describes the control principle as it relates to an accounting information system is that, the principle prescribes that an accounting information system have internal controls.

Answer:

The principle prescribes that an accounting information system have internal controls.

Explanation:

Because it is the "Correct Answer"

What could this sign use on the left side

Answers

What, ok I just take the points

evaluate three ways in which employment will minimize emotional stress

Answers

Answer:

Employment allows you to provide for yourself and your family. With employment, you are likely to have your basic necessities covered, like food, utilities and housing.

Employment makes you feel useful in some way, makes you feel as a contributing member of society, a feeling that helps you increase your feelings of self-worth.

Finally, employment helps you plan ahead for the future. If the employment pays well, or if you manage to spend less than you earn, employment allows you to save money, which is the first step in building a personal equity.

The ways in which employment minimizes emotional stress include:

An employment provides a means of socialisation. This would reduce isolation. An employment is a source of income. This allows people to be able to afford luxuries that would reduce emotional stress. Employment reduces idleness.

What is employment?

Employment refers to when members of the labor force have a job for which they receive some form of compensation.

In a _________________________ economy, the individuals and the government share in the economic decision-making process. These groups work togther to ensure economic development.

Answers

Answer:

Mixed economy

Explanation:

There are three types of Economies:

Command Economy:

An economy where price and products are controlled by the government. It is very commonly seen in communist countries, like China or Vietnam.

Free market:

An economy where the government has little to no control. However, a perfect free economy doesn't exist anywhere, and is just a concept.

Mixed Economy:

An economy where the market is controlled by both the people/consumers, and the government. America is a mixed economy. Individuals are allowed to own property with little government intervention. However, the government has a lot more control over other sectors of the market.

So, to answer the your question, because the Mixed economy is controlled by the government and the poeple, it is the answer.

When a company strives to achieve lower overall costs than rivals and appeals to a broad spectrum of customers, it pursues Multiple choice question. an overall low-cost provider strategy. a focused low-cost strategy. a best-cost provider strategy. a broad differentiation strategy.

Answers

Answer:

an overall low-cost provider strategy.

Explanation:

Competitive advantage can be defined as conditions, factors or circumstances that allow a business firm (organization) to manufacture finished goods or services better and perhaps cheaper than other (rival) firms in the same industry. Thus, it's responsible for putting a business firm in a superior or more favorable position than rival firms.

This ultimately implies that, a competitive advantage has a significant impact on a business because it increases its level of sales, revenue generation and profit margin when compared to rival firms in the same industry.

A overall low-cost provider strategy is a strategic business model that's typically focused on a broad customer base (segment) while still making profit by providing low-cost goods and services to the customers, as well as underpricing rivals in the same industry.

This ultimately implies that, it is a business strategy that involves lowering the price of goods and services in order to stimulate demand, generate more revenue, draw more customers and gain a competitive advantage over competitors or rivals in the same industry.

Hence, when a company strives to achieve lower overall costs than its rivals in the same industry and appeals to a broad spectrum of customers, it is considered to pursue an overall low-cost provider strategy.

Why is it important for o evaluate your advertising campaign when it is complete?

Answers

Answer:

A well-documented evaluation of your campaign builds credibility and respect. It helps determine if your ads are hitting the target audience, and what are their opinions and feedback on it.

Explanation:

The evaluation of your advertisement campaign helps in enhancing transparency and the report showcases the achievements you have attained during this and also helps showcase the entire campaign to every key stakeholder. It helps in building trust across the various departments in the company and enables them to measure the strengths and weaknesses of the campaign, in order to adjust for future campaign drives.

who here from K12? (sorry for asking this question)

Answers

Answer:

Explanation:

Answer:

Not I.

Explanation:

This is just constructive criticism, but I don't recommend listing your school here.

What economic event began in 2007?
the Great Recession
O the Reconstruction
the Progressive Era
the Great Depression

Answers

Answer:

The Great Recession

Explanation:

The Great Recession began in December 2007 and ended in June 2009, which makes it the longest recession since World War II. Beyond its duration, the Great Recession was notably severe in several respects. Real gross domestic product (GDP) fell 4.3 percent from its peak in 2007Q4 to its trough in 2009Q2, the largest decline in the postwar era (based on data as of October 2013). The unemployment rate, which was 5 percent in December 2007, rose to 9.5 percent in June 2009, and peaked at 10 percent in October 2009. (Robert Rich, federalreservehistory.org)

Lakeside Incorporated manufactures four-lines of remote control boats and uses activity-based costing to calculate product cost Required: Suppose the Speedy boot requires 2,540 machine hours, 100 botches, and 300 inspections: Using the activity rotes, determine the amount of overhead assigned to the Speedy product line. Note: Do not round your intermediote calculations and round your final answers to the nearest dollar amount.

Answers

Therefore, the overhead cost assigned to the Speedy product line would be $66,040.

Activity-Based Costing (ABC) is a method of costing where costs are assigned to activities that are required to produce the products. Activity-Based Costing (ABC) systems enhance profitability by providing better and more accurate product costing information, supporting product rationalization decisions, and improving cost management capabilities.

When we look at overhead assignment to product lines, it is clear that activity-based costing can aid in understanding the overhead assignment process.In the problem given, Lakeside Incorporated manufactures four-lines of remote control boats and uses activity-based costing to calculate product cost. The Speedy boat requires 2,540 machine hours, 100 botches, and 300 inspections.

To determine the amount of overhead assigned to the Speedy product line, we must follow these steps:Total overhead cost = $260,000 / 10,000 MH = $26 per machine hourTotal overhead cost = $260,000 / 50,000 batch setups = $5.20 per setupTotal overhead cost = $260,000 / 1000 inspections = $260 per inspection

Overhead cost per unit of Speedy = (2,540 MH x $26/MH) + (100 botches x $5.20/botch) + (300 inspections x $260/inspection)= $66,040

Therefore, the overhead cost assigned to the Speedy product line would be $66,040.

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Adjusting entries help to ensure that all blank______ are recorded in the period in which they are incurred.

Answers

Adjusting entries help to ensure that every expense is recorded at the moment it happens.

What are the Adjusting entries?

Simply said, an adjusting entry is a change you make to your books to better match your revenue and expenses with your financial statements.

At the conclusion of the accounting period, adjusting entries are made. This can happen towards the conclusion of the month or the year.

An adjustment entry is one that is created to properly allocate each accounting period's income and expense amounts.

In order to ensure that the financial accounts at the end of the year are correct and current, it updates previously recorded journal entries.

Adjusting entries aid in making sure that every expense is documented during the time that it occurs.

Therefore, adjusting entries help to ensure that every expense is recorded at the moment it happens.

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Complete question:

Adjusting entries help to ensure that all ______ are recorded in the period in which they are incurred.

__________ relies on consumers to pass messages about products among themselves, typically through email.

Answers

Companies just a wild guess sorry if I'm wrong

In what kind of nation are members of a society most likely to have good educational opportunities?

a developing nation

a developed nation

a country emerging from an economic and political crisis

an underdeveloped nation

Answers

Answer:

a developed nation for states

When Burger World considered adding Italian beef to its menu, the company made the sandwiches available in some of its more established markets to determine customer reactions. That process is called

Answers

This process that Burger World embarked on in order to test customer reactions is known as Test Marketing

Test Marketing:

Involves a limited release of a new product Is done to check how customers will react to the product

If customers like the product then the company will start producing it in a higher quantity because it means that the product will likely be successful.

In conclusion, Burger World was engaging in Test marketing.

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ashley owns stock in a company which has consistently paid a growing dividend over the last five years. the first year ashley owned the stock, she received $1.71 per share and in the fifth year, she received $2.89 per share. what is the growth rate of the dividends over the last five years?

Answers

The growth rate of the dividends over the last five years is 9.9%.

CAGR is a measure of the average annual growth rate of an investment over a specified period of time, assuming that the investment has grown at a steady rate. To calculate CAGR for dividends, we need to know the initial dividend amount, the final dividend amount, and the number of years in between.

Using the formula for CAGR, we can calculate the growth rate of the dividends over the last five years as follows:

CAGR = (Final Dividend Amount / Initial Dividend Amount) ^ (1 / Number of Years) - 1

Substituting the values given in the problem, we get:

CAGR = ($2.89 / $1.71) ⁰°⁵⁻¹

CAGR = 0.099 or 9.9%

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