The management of McAngus, Inc., has never used formal planning techniques in the operation of its business. The president of McAngus has expressed interest in the recommendation of its accountants that the company investigate various techniques it may use to manage the business more effectively. mlo564 McAngus, a medium-sized manufacturer, has grown steadily. It recently acquired another company located approximately 1,000 miles away. The new company manufactures a line of products which complements the present product line. Both manufacturing plants have significant investments in land, buildings, machinery, and equipment. Each plant is to be operated as a separate division headed by a division manager. Each division manager is to have virtually complete authority for the management of his division; i.e., each will be responsible primarily for the profit contribution of his division. A complete set of financial statements is to be prepared for each division as well as for the company.

The president and his immediate management team intend to concentrate their efforts on coordinating the activities of the two divisions and investigating and evaluating such things as new markets, new product lines, and new business acquisition possibilities. Because of the cash required for the recent acquisition and the cash needs for desired future expansion, the president is particularly concerned about cash flow and the effective management of cash.: m456 Required:
Explain the objectives and describe the process which McAngus can use to plan for and evaluate the long-term commitment of its resources including cash. Confine your answer to known facts about McAngus, Inc., as presented in the question.