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The following is information about three different companies. Operating in the realm of software game development, Virtual Verse Studios specializes in crafting games designed for
The following is information about three different companies.
Operating in the realm of software game development, Virtual Verse Studios specializes in crafting games designed for the Android operating system. With its inaugural software title recently released, the company is in the process of extending its reach by bringing more developers and administrative staff onboard. Despite not having achieved profitability thus far, Virtual Verse Studios foresees reaching a profitable state within the upcoming two years. Investors recognize the company's technological innovation and progressive approach, consistently injecting funds into its endeavors. While Virtual Verse Studios hasn't engaged in borrowing activities yet, it contemplates the possibility of doing so in the future.
Situated in Harborview, California, FiberCraft Textiles Company operates within the textile sector. Celebrating its th year of consistent profitability, the company's management is currently facing apprehension due to the recent economic decline affecting the textile industry. This downturn has led to diminished sales over the past three fiscal years. Anticipating only breaking even in the upcoming year, the company has decided to forego expansion plans and solely focus on replacing fully depreciated machinery within its machineryintensive manufacturing operations. FiberCraft Textiles takes pride in its dividend payment practices and maintains a debtfree balance sheet.
InnovaTech Solutions, situated in Cedarville, Ohio, operates as a technology manufacturing entity. The company has recently launched its th new product and maintains a dominant position in market share within its industry. It remains committed to enhancing its operations through investments in new equipment and property, alongside strategic expansion via acquisitions of its competitors. Although the company hasn't distributed dividends thus far, it contemplates this possibility in the future. Notably, the most substantial current asset for the company is its cash reserve, attributable to its robust profit margin. Consequently, the company doesn't require external cash inflows due to its selfsufficiency.
Required:
For each business, create a report analyzing the potential positivity or negativity of the company's existing cash flows in each activity category: operating, investing, and financing. Substantiate your conclusions with supporting rationale.
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