Prior to beginning work on this discussion forum, read the following sections of Chapter 2: Financial Analysis and Planning in the Foundations of Financial Management textbook:
- Statement of Cash Flows
- Depreciation and Funds Flow
- Free Cash Flow
Initial Response:
Your CEO at your present job has just heard you graduated with your MBA. The CEO is both excited and proud of this monumental achievement. They are giving a financial update to stockholders in a few days, but they are stuck on some questions regarding the importance of the Statement of Cash flows. The CEO calls you into their office to congratulate you and to ask for your insight into the importance of cash flows.
For this discussion forum, address the following questions asked by your CEO,
- First, what is the purpose of the statement of cash flows?
- Next, explain the differences between a cash budget and a cash flow statement.
- Finally, explain why the cash flow statement is important to shareholders.
When addressing the questions, please be specific. Answers should be appropriate to the level of audience (CEO).
Your initial response should be a minimum of 250 words. Graduate school students learn to assess the perspectives of several scholars. Support your response with at least one scholarly or credible resource. Cite your sources in APA Style with in-text citations and a reference list.
