American Homepatient Inc (Management Essay)

American Home patient Inc.
Name
Institution/ Affiliation
American Home patient Inc.
Financial statements are essential elements of decision making. They provide investors, lenders, customers, suppliers, the general public, management, and employees with information about an organization’s debt load, revenue, profitability, expenses, and the ability to meet financial obligations (Boby, 2013). This study will use a balance sheet to determine the company's financial position by comparing the comparing assets with liabilities. The income statement will be used to determine the company’s profitability. The study will also utilize cash flows statement to determine how much cash the organization has generated. Lastly, the shareholder's equity statement will be used in planning because it offers insights on investments' performance. 
Financial statements have significant impacts on financial decisions, stock prices, and luring new investors. For example, investors rely on financial statements when making investment decisions. In this respect, if the information in these financial statements is good or worse, it can influence stock price upwards or downwards. On the other hand, investors are only willing to invest in companies whose stock price is relatively performing or have the potential to improve (Elias, 2007). Similarly, creditors and suppliers will only be willing to advance credit to an organization with better equity ratios. As such, American Home Patient Inc. must improve its financial statement to access unlimited financing opportunities and attract new investors.
In any organization, budgeting plays a vital role in improving cash flows, increasing profits, minimizing costs, and maximizing investment returns. In the current ever-changing business environment, American Home patient Inc. should adopt a flexed budget as it accurately reflects the finances' status. Besides, it allows management to analyze the actual and expected output and plan effectively (Edwardlowe.org, 2020). It also offers the basis for comparing...