Question
How would the following affect Net Cash flows? Instructions: Read through the following scenarios and determine 1) what type of activity is being considered and
How would the following affect Net Cash flows?
Instructions: Read through the following scenarios and determine 1) what type of activity is being considered and 2) what are the effects on cash flows. Give a explanation for your reasoning.
Scenarios:
1.A successful pharma company substantially reduces its expenditures for research and development.
2.A wood manufacturer reduces the size of its inventories of raw material by 50%.
3.Through strategic tax planning, a software company is able to defer significant amounts of taxes.
4.A restaurant that previously operated as cash only changed its policy to accept bank card (i.e. Visa cards)
5.A coffee producing corporation announced that is will stop paying cash dividends.
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