Like Great Job Respond To At Least 2 Classmate A

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Like Great Job Respond To At Least 2 Classmate A

Respond to at least 2 classmate (appx. 100 words).

My COURSE is Accounting for HEALTHCARE.

Discussion Board is:

  1. (Working Capital Management and Banking Relationships- Chapter 15) Briefly comment on the implication of using a concentration bank for an organizations cash management activity.
  2. (Capital Structure – Long Term Debt and Equity Financing- Chapter 17) Briefly discuss the methods used in determining an organizations cost of capital and the value resulting from it.

My First classmate post is

Cash management is the term that refers to collection, concentration and disbursement of cash and this is important for new growing businesses. Concentration banking is for shifting funds in a set of huge amount from bank into an investment accounts through this the fund can be used more efficiently. This is more expensive process considered. This process has large value in business it has a number of subsidiaries or location, with its own accounts. The concentration banking can have the legal problems with legal entries and some who has financial position may suffer from cash withdrawal but other hand it have solved with cash transfers and with recorded loans. Concentration banking will give benefit to organization they can then hire an investment manager who is responsible for investing all of the funds that can shifted into centralized location. This bank requires an organization which kept all of their bank accounts with a single bank and by this process this bank can transfer fund to investment account with a simple memo entry.

Cost of capital is required to make a capital budgeting for the projects like for building a new factory it includes the cost o debt and the cost of equity. It is to check out the company worth and expenditure of recourses by investor. There is many ways to determine the cost of capital the capital is to have a better business in varies of variety it can be better with capital campaigns which can be result from health care organization which is engaged in focused funding activities other is venture capital result from the convince power if you convince the investor to place a lot of money in the business without lengthy process it Is rely on heavy business plans in organization. It is a start up business that require to weather to have potential variable business before they have invested in a business. There is not for profit health care organization. In cost of capital the organization must have to commit with their resources as they are significant that they have successful capital campaign. This refers to extent the funds which require by an organization with different stages. The total cost of capital would be least that is optimal structure for an organization. Resource must be from an organization that comes from non profitable to profitable areas.

My second classmate post is

  1. (Working Capital Management and Banking Relationships- Chapter 15) Briefly comment on the implication of using a concentration bank for an organizations cash management activity.

Concentration banking is the practice of shifting the funds in a set of bank accounts into an investment account, from which the funds can be more efficiently invested. It is usually required that an organization keeps all of its bank accounts with a single bank to improve the efficiency of cash management. The consolidation of cash into a single account also allows a company to maintain smaller cash balances overall, and to identify excess cash available for short-term investments. The cash available in different bank accounts is pooled into a master account. The advantages of cash concentration are 1) Cash control 2) Cash visibility

  1. (Capital Structure – Long-Term Debt and Equity Financing- Chapter 17) Briefly discuss the

methods used in determining an organizations cost of capital and the value resulting from it.

A firm’s Weighted Average Cost of Capital represents its blended cost of capital across all sources, including common shares, preferred shares, and debt. The cost of each type of capital is weighted by its percentage of total capital and they are added together. This guide will provide a detailed breakdown of what WACC is, why it is used, how to calculate it. WACC is used in financial modeling as the discount rate to calculate the net present value of a business.

Reference

https://www.accountingtools.com/articles/concentration-banking.html (Links to an external site.)

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