FOR ESSAYS GURU ONLY 92

BluJay Aviation, Episode 7

MGMT 210 Financial Accounting

BluJay Aviation, Episode 7 Scene Wren and Brad discuss their cash position and customer collections at Eagle One’s FBO office. Brad: I just don’t understand why we’re always short of cash even though we generate a profit. I would really like the new business consultant group to explain that to me. Wren: Part of the problem is collecting the cash from our clients. Brad: I think our clients are steady and some have been with us since we started business and seem to be happy with our services. Wren: Up till now they have paid their bills, but often it is what I call “slow pay.” Usually late based on our policy of 30 days after we provide the service. Brad: I’m a bit worried about the realtors. Business is very slow and the housing market is still in the dumps around here. Wren: You know the marketplace a lot better than I do. Do you think some of them will not pay us for work we’ve already done? Brad: I certainly hope not, but maybe we should start thinking that’s possible. Wren: Any ideas about speeding up the payments? Or maybe we should change our billing policy. I really liked it when we were able to get them to pay ahead of time. Brad: Let’s call up our consultants and ask them to look into this too. Wren: Great idea. Did we find out what they’re charging? I hope it’s not an arm and a leg. If so, I’m giving them yours.