Disucssion Question 1 week 2 Investment Information Assignment

Disucssion Question 1 week 2 Investment education - Assignment Examples on a club with a good record of hard cash generation from its daily business so as to reduce risk of investment and boost prospects of compulsory returns.The firms being con attitudered by the investor might have realized high returns resulting to good cash flows. In such fortunes, the criteria of choosing a suitable business entity to invest in will change- the investor should go for the company which invests its returns in a manner that would benefit him (Brigham & Ehrhardt, 2011). For example, Company A saves most of its return for a rainy day epoch company B pays its shareholdersA balance sheet is often described as a guessing of a companys financial condition categorically stating the balances of the business at the end of each financial year. The left(p) side comprises of the Assets (things the company owns ) listed in order of the time taken to change them to money (liquidity), and the right side made up of debts of the business and amounts payable. Thus, an investor should choose to invest his or her financial assets on a company with a large asset base which will ensure security of his invested capital in case of anything, and refrain from investing in companies with a high gearing ratio since it will result to a little or zero return on his investment and the risk of losing the invested capital increases