Managing Finance Resources and Decisions subject Assignment - 1

Managing Finance Resources and Decisions subject - Assignment ExampleWhen it comes to the cash flow forecast of North Seaton, the omen shows that the company is failing to generate adequate income to cover its expenditures. A relatively comparison of the income and expenditure selective information suggests that the increase in expenditure is not being equally complemented with a similar or greater level of increase in the net income (Schleifer, Sullivan and Murdough, 2014). That is why the monthly surplus figures atomic number 18 far dismantle than the deficits which in turn results in the company incurring significant proportion of cash flow deficits every(prenominal) month. Moreover, the company is failing to attain economies of scale and scope which is why the purchase expenditures have been increase in the last six months of the year. The cash deficits that has been realized every month is also because of the insurance premium of 55,000 and 50,000 salaried in the month of January and May respectively. This has largely depleted the profit margin for the company. The quarterly bill compensable for electricity and heat has also reduced the companys margin of income. Although the expenditure behind buying company vehicles was one off, but it has proven to be big burden for the company given the particular that they have to incur a constant maintenance expense of 11,000 throughout the year. All the above mentioned facts are largely responsible for the cash deficits incurred by the company every month.b. The major reason behind such(prenominal) problems within the sales budget can be attributed to the failure of the company analysts in forecasting the want for products. The inaccurate predictions led to a demand supply gap which in turn led the company to incur negative variances between sales budget and the generated sales (Nugus, 2009). Other reasons that can be attributed to this variate are inappropriate marketing strategies adopted by the company,