FM1-Assignment 2: Discussion—Projecting Financial Trends

An organization’s finances are closely linked to local and global markets. Therefore, regular monitoring of economic factors, such as employment, inflation, supply and demand, and interest rates is sure to provide beneficial information. Therefore, it is important to understand the impact of economic factors upon an organization’s current and future operations and finances.

1. Using the module readings, Argosy University online library resources, and the Internet, research two to three articles on the importance of analyzing economic factors for organizations.
   
   Then respond to the following: 
   
   
   • Why should companies pay attention to economic factors when managing the organization’s current and future financial information?
   • Consider an organization you are familiar with. Identify the economic factor that has had the most impact on the organization’s earnings in the past 5 years.
   • How has this factor impacted the organization and how has the organization dealt with the impact in a positive or negative manner?

1. Please put the following income statement and balance sheet terms in the proper order:
   
   

   Taxes, interest, gross profit, selling, general and administrative expenses, sales, depreciation, net income, cost of goods sold, and EBITDA.

1. For the balance sheet, please categorize the following as short-term assets, long-term assets, short-term liabilities, long-term liabilities, or owner’s equity:
   
   

   Cash, accounts payable, accruals, property, plant and equipment, inventory, accounts receivables, paid in capital, retained earnings, notes payable, mortgage, and accounts payable.

1.  Please explain in which order the four major financial statements need to be prepared, and why. 
   
   
2. Please also explain the three major categories of the statement of cash flows and under which category the following items belong. Also explain whether or not each item would be considered a source or use of cash for the period in question:
   
   

   Inventory-increased for period
   Net income-increased for period
   Accounts receivables increase for period
   Accounts payable decrease for period
   Accruals decrease for period 
   Depreciation-increases for period
   Stock issued 
   Property purchased
   Bonds paid off
   Inventories increase for period
   Cash decreases
   Notes payable increase for period
   Bonds redeemed for period

By Friday, October 2, 2015, post your response to the appropriate Discussion Area. Through Saturday, October 3, 2015, review and comment on at least two peers’ responses.

Write your initial response in 300–500 words. Your response should be thorough and address all components of the discussion question in detail, include citations of all sources, where needed, according to the APA Style, and demonstrate accurate spelling, grammar, and punctuation

Do the following when responding to your peers:

• Read your peers’ answers.
• Provide substantive comments by
• contributing new, relevant information from course readings, Web sites, or other sources;
• building on the remarks or questions of others; or
• sharing practical examples of key concepts from your professional or personal experiences
• Respond to feedback on your posting and provide feedback to other students on their ideas.
• Make sure your writing
• is clear, concise, and organized;
• demonstrates ethical scholarship in accurate representation and attribution of sources; and
• displays accurate spelling, grammar, and punctuation.

Grading Criteria