Discretionary Funds and Global Cash Flow?

Discretionary Funds and Global Cash Flow?
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High interest rates can affect global cash flow with banks charging higher financing costs. This will lower external finance demand as institutions concentrate on small debt servicing instead of financing larger projects. There will be less capital for entrepreneurs. The result would be a general slow-down of the economy.Entrepreneurs depend on liquidity of the money supply. Global cash flow analysis of their loans may reveal weaknesses in debt coverage or the comingling of the same resources to simultaneously support different debt demands. Loan officers must give careful study to the debtor's global cash flow inflows.Discretionary cash flows must be analyzed. Schedule K-1 reports should be scrutinized in the situations of partnerships. It would demonstrate how cash flow is broken down by partners and what income and debt may be discretionary.The fact that one can transfer income from one source to service the debt of another source is the basic tenent of global cash flow analysis. Revenue sources must be analyzed to make sure that they are not circular or that a pyramid-like supporting scheme is not involved.To some extent all global cash flow analysis reflects a system of circular support. The main factor would be the timing involved that would make the support appear discretionary or not. In order to make proper adjustments, loan officers must cut through the circular support and analyze all related businesses as individual structures.By deterining whether these individual structures can stand on their own in the demand and supply of global cash flow, a determination can be reached as to whether the entity can tap into sufficient cash flow to service its debt. Once the determination is made, it should stand as representing a balanced and sustainable economy.One should not rob Peter to pay Paul. In all events, this actually happens. It is just the time-delay that is involved which makes it expedient for Peter to rob Paul at this time or that time. The decision depends on the global cash flow which Peter requires. If Peter is not underwater, he may delay his robbing of Paul and avoid killing the economic system.
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Related questions

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A comprehensive spending pattern: A)shows the percentages of annual family expenditures allotted to general classes of goods and services B)indicates the annual amounts spent by families for specific products within a general product class C)shows the annual discretionary income of consumers D)is used to determine the precise buying power of individuals

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Last Answer : A)shows the percentages of annual family expenditures allotted to general classes of goods and services

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Income left over after an individual pays taxes and purchases the basic necessities of food, clothing and shelter is called: A)disposable income B)taxable income C)accounting income D)discretionary income E)credit

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Last Answer : D)discretionary income

Which of the following companies would probably be most interested in tracking discretionary income levels? A)Asda Supermarkets B)BMW automobiles C)The Post Office D)Kraft General Foods E)Marks and Spencer

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Last Answer : (c) Organizational citizenship ;

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Alfa Company Limited acquired the business of M/s Bharat Traders. The valuation of the items acquired was-building Rs. 1,20,000; machinery Rs. 80,000 and stock-in-trade Rs. 30,000. The company issued in lieu of the above items 800, 10% debentures of Rs. 100 each at par and 15,000 equity shares of Rs. 10 each. How much was the flow of funds in the above transaction ? (A) Rs. 2,30,000 (B) Rs. 1,00,000 (C) Rs. 50,000 (D) Rs. 30,000

Description : Alfa Company Limited acquired the business of M/s Bharat Traders. The valuation of the items acquired was-building Rs. 1,20,000; machinery Rs. 80,000 and stock-in-trade Rs. 30,000. The company issued in lieu of the above items 800, ... ) Rs. 2,30,000 (B) Rs. 1,00,000 (C) Rs. 50,000 (D) Rs. 30,000

Last Answer : Answer: Rs. 30,000

-------------------means transfer of economic value of firm from one asset or equity to another. a) Flow of funds b) Uses of fund c) Inflow of funds d) Application of funds

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Fund flow statement is accompanied by a schedule of----------------------------- a) Changes in working capital b) Flow of funds c) Increase in fund d) Decrease in fund

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What is a real estate cash flow note?

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How much do cash flow notes cost.?

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Last Answer : The cost of Cash Flow Notes vary, you should call the seller that you have intent to purchase them from to check their pricing for the giving period of time.