Scissors effect. Working capital requirement. Operating cycle. Treasury balance. Graph.

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Published on Nov 7, 2022

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Slides for this class: https://professorquintino.com.br/slid... The Scissors Effect occurs when a company gets carried away with its sales and extends credit to customers without having enough financial resources for its working capital, being forced to resort to loans from financial institutions. The recurrence of this attitude leads to a considerable mismatch between the need for capital and working capital and the net working capital. By plotting this data on a graph, we observe a separation of the NCG (operational applications) and CCL (short-term sources) curves, producing a visual effect similar to that obtained by the two parts of a pair of scissors. 00:04 - Definition 00:50 - Review of the operating cycle 02:22 - Remembering the working capital requirement formula 03:14 - Making a simple calculation 04:49 - Net working capital formula 04:58 - Link between net working capital and the current liquidity ratio 05:23 - Presentation of the company Casa das Tesouras and its accounting documents 05:45 - 1st year analysis report 06:25 - 2nd year analysis report 07:02 - 3rd year analysis report 07:47 - Something wasn't right! 08:01 - The company suffered the scissors effect 08:23 - Making the scissors effect graph 09:14 - Data from year 1 10:10 - Data from year 2 11:16 - Data from year 3 12:18 - Completion of the graph 12:31 - Causes of the scissors effect 13:00 - How to correct the scissors effect 13:46 - Treasury balance 15:18 - Professor Quintino's courses 15:54 - Closing -------------------------------------------- On this Professor Quintino website 🔗(https://professorquintino.com.br), 🔎you will find the channel's videos organized by discipline and in sequence, according to the syllabuses of the academic disciplines. Visit: https://professorquintino.com.br -------------------------------------------- Subscribe to the channel at this link: 👊 https://www.youtube.com/@professorqui... ---------------------------------------------- In the following list, there are the links to access the videos, organized in order, according to the main syllabuses of the subjects explored in the channel. 🔗 Video that brings together all subjects: • Video links, organized in sequence... 📕 Basic Accounting: • Basic Accounting. Video links... 📗 Intermediate Accounting: • Intermediate Accounting. Video links... 📚 Advanced Accounting: • Advanced Accounting. Video links... 📘 Cost Accounting: • Cost Accounting. Video links... 📙 Tax Accounting: • Tax Accounting. Video links... 📔 Accounting Theory: • Accounting Theory. Links to the videos... 📒 Analysis of Financial Statements: • Analysis of Financial Statements. ... 🌎 Economy: • Economy. Links to the videos, in the sequence... 📈 Financial and Capital Markets: • Financial and Capital Markets. Lin... 💰 Financial Education: • Financial Education. Links to the videos... --------------------------------------------

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