If we have know in intermediate finance, we can manage cash perfectly.

All businesses aim

to maximize their profits, minimize their expenses and maximize their market share and
maximize profits A company's most important goal is to make money and keep it. Financial
services are the economic services provided by the finance industry, which encompasses a
broad range of businesses that manage money, including credit unions, banks, credit-card
companies, insurance companies, accountancy companies, consumer-finance companies,
stock brokerages, investment funds and some government-sponsored enterprises. The
financial manager in a corporation makes decisions for the stockholders of the firm.

If we assume that stockholders buy stock because they seek to gain financially, then the
answer is obvious: Good decisions increase the value of the stock, and poor decisions
decrease the value of the stock.The financial manager acts in the shareholders' best interests
by making decisions that increase the value of the stock. The appropriate goal for the
financial manager can thus be stated quite easily:

working capital management

if we have knowledge in working capital management then we can manage inventories

efficiently using computerized database management. Reducing the cost of sales by
efficient management practice. Managing the company’s fixed as well as current asset
efficiently to generate smooth operation. Accelerating the sales volume through
effective marketing and distributing channel.

Accounts Receivable Turnover Ratio is showing that the company is requiring lesser
time to collect cash from its creditors. In spite of increased receivables the increment
in the ratio is an indicator of improvement in the efficiency of turning the receivables
into cash quickly and is a good sign for the company and it will be able to avoid
liquidity crisis. Restructuring the capital format in such a way so as to the company
can add some leverage to its capital structure. Working capital is a daily necessity for
businesses, as they require a regular amount of cash to make routine payments, cover
unexpected costs and purchase basic materials used in production of goods.
capital structure is used in business in many ways. The terms "governance," "business," and "legal,"
are all associated with their own "structures" for instance, referring to aspects of company set up
and operation. Two other similar terms are frequently used to describe the nature of the company's
financial position: Financial structure and capital structure. These structures concern the "Liabilities +
Equities" side of balance sheet equation: For each company there is an optimal capital structure,
including a percentage of debt and equity, and a balance between the tax benefits of the debt
and the equity. As a company continues to increase its debt over the amount stated by the
optimal capital structure, the cost to finance the debt becomes higher as the debt is now
riskier to the lender.The risk of bankruptcy increases with the increased debt load. Since the
cost of debt becomes higher, the WACC is thus affected. With the addition of debt, the
WACC will at first fall as the benefits are realized, but once the optimal capital structure is
reached and then surpassed, the increased debt load will then cause the WACC to increase
significantly.

For each company there is an optimal capital structure, including a percentage of debt and
equity, and a balance between the tax benefits of the debt and the equity. As a company
continues to increase its debt over the amount stated by the optimal capital structure, the cost
to finance the debt becomes higher as the debt is now riskier to the lender.
The risk of bankruptcy increases with the increased debt load. Since the cost of debt becomes
higher, the WACC is thus affected. With the addition of debt, the WACC will at first fall as
the benefits are realized, but once the optimal capital structure is reached and then surpassed,
the increased debt load will then cause the WACC to increase significantly.

If we have knowledge in cash then we can maintain our cash in an industry perfectly.
we can also maintain transaction balance, speculative balances, precautionary Balances
,compensating balance. Cash management is particularly important for new and growing businesses.
Cash flow can be a problem even when a small business has numerous clients, offers a product
superior to that offered by its competitors, and enjoys a sterling reputation in its industry. Companies
suffering from cash flow problems have no margin of safety in case of unanticipated expenses. They
also may experience trouble in finding the funds for innovation or expansion. It is, somewhat
ironically, easier to borrow money when you have money. Finally, poor cash flow makes it difficult to
hire and retain good employees.
It is only natural that major business expenses are incurred in the production of goods or the provision
of services. In most cases, a business incurs such expenses before the corresponding payment is
received from customers. In addition, employee salaries and other expenses drain considerable funds
from most businesses. These factors make effective cash management an essential part of any
business's financial planning. Cash is the lifeblood of a business. Managing it efficiently is essential
for success.
Cash collection systems aim to reduce the time it takes to collect the cash that is owed to a firm.
Some of the sources of time delays are mail float, processing float, and bank float. Obviously, an
envelope mailed by a customer containing payment to a supplier firm does not arrive at its
destination instantly. Likewise, the payment is not processed and deposited into a bank account the
moment it is received by the supplier firm. And finally, when the payment is deposited in the bank
account oftentimes the bank does not give immediate availability of the funds. These three "floats"
are time delays that add up quickly, and they can force struggling or new firms to find other sources
of cash to pay their bills.

Cash management attempts, among other things, to decrease the length and impact of these "float"
periods. A collection receipt point closer to the customer-;perhaps with an outside third-party
vendor to receive, process, and deposit the payment (check)-;is one way to speed up the collection.
The effectiveness of this method depends on the location of the customer; the size and schedule of
its payments; the firm's method of collecting payments; the costs of processing payments; the time
delays involved for mail, processing, and banking; and the prevailing interest rate that can be earned
on excess funds. The most important element in ensuring good cash flow from customers, however,
is establishing strong billing and collection practices.

long-term debt can help a company magnify its financial success, but the burden of principal
and interest payments may become too heavy for companies that borrow excessively.Interest
rate changes can motivate companies to repay long-term debt before it is actually due. If a
company notices that interest rates have fallen below the rate the company is currently paying
on its debt, the company may choose to pay off the high-rate debt with new, lower-rate debt.

It is important to read the notes to financial statements when studying a company's long-term
debt. Debt terms and requirements vary widely from company to company. Comparison of
long-term debt amounts is generally most meaningful among companies within the same
industry, and the definition of a "high" or "low" amount of debt should be made within this
context. A company's long-term debts are ranked on the balance sheet in the order they will
be repaid if the company is liquidated. A company must record the market value of its long-
term debt on the balance sheet, which is the amount necessary to pay off the debt as of the
date of the balance sheet.Don't confuse long-term debt with total debt, which includes debt
due in less than one year.