A company that produces racing motorbikes has several models that sell well within the motorcycle racing community and which are very profitable for the company. Despite having a profitable product, why must this company take care to ensure that it has sufficient cash on hand to meet its obligations

Question

Brenden Ware

Business

8 June, 12:01

A company that produces racing motorbikes has several models that sell well within the motorcycle racing community and which are very profitable for the company. Despite having a profitable product, why must this company take care to ensure that it has sufficient cash on hand to meet its obligations

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Answers (1)

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Tommy · Answer 1

Answer: Producing new models would require lots of money to set up before the revenue builds

Explanation:

This company must endeavor to have enough cash at hand because production of motor bike are very expensive to produce and launch in to the market, they'll have to be excess in their reserves for this operations.