Fluent Essays

Attached is assignment due, You will be responding to post by 2 students by making a substantive contribution must be at least 1 1/2-2paragraphs in length with a minimum of 2 peer-reviewed references in APA Format. No Wikipedia, BLOGS with ads from yahoo.com or google.com, as they present biased opinion. Use peer-reviewed articles to support your thoughts! You will respond as if you are speaking to student, for example: Great post Cynthia,  I like that you  mention.......i would like to add...based on your discussion...etc or you can even concur if you do not agree with everything indicated by student. https://keiseruniversity.libguides.com/c.php?g=759268&p=5444887 Username: [email protected] Password: 547GorgeRd Finding Academic Scholarly Articles Academic literature is very important to your graduate work. You will want to limit the use of the Web, and instead increase the use of scholarly literature. Note: Wikipedia is not an acceptable source for graduate-level work. All of your opinions should be backed-up with academic scholarly peer reviewed articles whether they be in discussions or in papers. Your textbook alone as a source is never enough. To find this academic literature all you need to do is go to your online library. The link and instructions on how to log in are located under Course Home. I would suggest you begin with ProQuest database at the LIRN area of the online library. Within the ProQuest database you will want to be sure that you check the two boxes at the bottom of your keyword search: you want to check full text and you want to check the box for scholarly peer-reviewed work (these are academic). On the ProQuest site youll see a little graduation tassel to indicate this will render academic scholarly journals and literature. ProQuest says of academic articles: Scholarly Journals, including peer-reviewed A publication is considered to be scholarly if it is authored by academics for a target audience that is mainly academic, the printed format isnt usually a glossy magazine, and it is published by a recognized society with academic goals and missions. A publication is considered to be peer reviewed if its articles go through an official editorial process that involves review and approval by the authors peers (people who are experts in the same subject area.) Most (but not all) scholarly publications are peer reviewed. Some trade publications are actually peer reviewed, but ProQuest does not consider them when filtering on peer reviewed. This is because getting results from trade publications instead of academic journals can be frustrating to researchers. Instead, ProQuest excludes these peer reviewed trade publications and only considers publications that are scholarly in terms of content, intent, and audience. Enjoy exploring the library. It is one of the great joys of academic research! Question by Professor: Businesses hold marketable securities (cash equivalents and short-term investments) for two primary reasons: As an interest-earning substitute for cash. As a temporary repository for cash being accumulated to meet a specific near-term need. In reality, cash management and marketable securities management are accomplished simultaneously. What are some of the advantages and disadvantages of holding marketable security both for long-term and shorten reasons? You post must at least 1 paragraph each with a minimum of 2 peer-reviewed references in APA Format. No Wikipedia, BLOGS with ads from yahoo.com or google.com, as they present biased opinion. Use peer-reviewed articles to support your thoughts! Student 1: Alejandro De La Portilla Mechoso Advantages and disadvantages of holding marketable security both for long-term and shorten reasons. Different companies or governments have different reasons for holding marketable securities. Some firms or governments keep them since they need substitute cash. Others hold marketable securities in place of large cash balances with the hope of liquidating part of the portfolio to increase cash when cash shortages arise. Moreover, other companies or governments hold marketable securities due to the need for temporary investment especially with firms engaged in cyclical operations and encounters surplus cash flows in one period and deficit in another period (Badoer & James, 2016). Thus, companies hold marketable securities as financial stocks for transaction, speculative ad precautionary purposes. Advantages One of the advantages of holding marketable securities especially in long term is that it offers a safety margin in the availability of funds despite its higher cost-reducing the profit potential of a company. Holding securities for short-term financing assures company liquidity of the firm reducing the uncertainty of being insolvent despite distracting a company from profit abilities. Holding marketable securities either short-term or long-term is essential to a company as it is a central concept to a firm’s potential to meet its long-term or short-term debts and other financial obligations. Lastly, holding marketable securities assists companies to bargain purchases thereby providing growth opportunities (Chireka & Bamidele Fakoya, 2017). Disadvantages Holding marketable securities in excess is highly risky as it is subject to misuse by management and in addition, there is a possibility of conflict of interest arising between the owners and the management. Also, holding less marketable securities may lead companies to financial distress thereby bankruptcy as a result of the inability to meeting its prevailing obligation (Kuldeep & Misra, 2019). Thus, the need of companies and governments keeping that amount of the cash needed for daily use while the rest are invested to earn interest. Holding excess marketable securities tends to establish a free cash flow issue with companies due to managers may invest in the free cash flow into low returns projects or wasting it on other organizational inefficiencies. References BADOER, D., & JAMES, C. (2016). The determinants of long-term corporate debt issuances. The Journal of Finance, 71(1), 457–492. https://doi.org/10.1111/jofi.12264 Chireka, T., & Bamidele Fakoya, M. (2017). The determinants of corporate cash holdings levels: Evidence from selected South African retail firms. Investment Management and Financial Innovations, 14(2), 79–93. https://doi.org/10.21511/imfi.14(2).2017.08 Kuldeep, S., & Misra, M. (2019). Financial determinants of cash holding levels: An analysis of Indian agricultural enterprises Student 2: Annabis Albino Many companies short term securities on their balance sheet. The company’s short-term securities with three-month maturities or less are lumped in with cash and are often labeled cash ad cash equivalents. Maturity short-term securities between three months to one year are short-term investments that are reported separately. Marketable securities serve as an interest-earning substitute for cash balances. Marketable securities also hold funds that are being accumulated to meet specific significant near-term obligations, whether tax payments or capital expenditure (Gapenski & Reiter, 2021). When it comes to borrowing money, companies, municipalities, and governments issue debt securities, the issuer pays the loan interest. It pays the initial loan amount in full at a specified future date. The companies that issue the debt do not dilute company ownership, and the management maintains control over the corporate operations. The company is aware of its liability which can be the principal amount borrowed plus interest payments. The amount can vary if the bond is a viable interest bond. The company can deduct the interest in their company taxes. Debt is temporary, and the obligation is in full when the bond matures (Baer, 2011). Marketing securities also have their disadvantages. Loans must be prepaid, or the bondholder will take legal steps, including forcing the company to go into bankruptcy. The company’s that are having economic difficulties may have problems meeting their interest payments. Interest expenses can be financially hard on corporate operations and profits. The amount a company can borrow is limited to the amount of interest it can handle. Some loans require a company to pledge collateral or company assets. Investors and analysts examine a company’s debt to ratio. If the ratio is too high, the investors may consider the company too risky and not invest in the business (Baer, 2011). References: Baer, M. (2011). Advantages & Disadvantages of Marketable Securities | Sapling.com. Sapling.com. https://www.sapling.com/8553383/advantages-disadvantages-marketable-securities Gapenski, L. C., & Reiter, K. L. (2021). Gapenski’s Healthcare Finance: An Introduction to Accounting and Financial Management. Health Administration Press; Washington, Dc.