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Business Failures of Organisations - Essay Example

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The paper "Business Failures of Organisations" states that the organization needs to ensure that it has enough money in order to pay for six months of expenses that may be incurred in the future. It does not necessarily means that the organization needs to keep the money locked up in the bank…

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Subject: Finance & Accounting
Type: Essay
Level: Masters
Pages: 1 (250 words)
Downloads: 2
Author: twalker

Extract of sample "Business Failures of Organisations"

The organization should invest the money in assets and investment options that can be easily converted into cases when required. For example, the company can invest the money in a bank’s saving account to earn returns on this amount of money (Whittington, 2012, p.631). Another issue that an organization may fail in relation to financial management is overestimation and underestimation of budgeted revenues as well as expenses that the business may incur in the future. In order to ensure that the company continues to operate successfully and the company has the required financial resources to pay off its loan, the company should indulge in underestimation of the sales of company (Etzel, 2007, p.175). In order to estimate the sales the company can conduct interviews with the customers regarding their intention to purchase the goods and services and how often they may do so (Jenster, 2009, p.189). Read More

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