Week 1 DQ - red, with the expectations of increasing the...

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Why is it not necessarily bad for the cash flow from assets to be negative for a particular period? If a company is constantly experiencing negative cash flows, you may want to look into the reason behind the problem. But, there are a number of legitimate reasons that a company could experience a negative cash flow for a particular period. #1 Expansion If a company is expanding their business, they may have to take out loans that put them “in the
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Unformatted text preview: red, with the expectations of increasing the potential profits. #2 Seasonal business Some companies earn a similar amount of money in each of their financial periods, while other companies earn the majority of their money in a single period. A couple of examples would be a company that sells Christmas decorations, or a company that provides lawn care service in an area that experiences all four seasons....
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