2.1.4 planning Flashcards
1
Q
who will use your business plan
A
- internally by entrepreneur
- externally by: banks, investors, grants etc
2
Q
what does a business plan contain
A
- executive summary
- business including products/services
- market; size,share,competitors
- marketing strategy
- skills of the entrepreneur
- operations
- financial forecast
3
Q
what is the purpose of a business plan
A
- secure external funding
- give firm healthy financial structure
- identify problem areas within plan
- to set targets
- to track firms development
- provide realistic expectations
4
Q
name 5 ways to inflow cash
A
- cash sales
- payment from debtors
- owners capital invested
- sale of assets
- bank loans
5
Q
name 5 ways to outflow cash
A
- purchasing stock
- paying wages
- paying debts
- creditors
- purchasing assets
6
Q
why is cash flow important
A
as it ensures a positive cash balance in order to be able to meet day to day expenses
7
Q
what is a cash flow forcast
A
forward looking statement which tries to predict cash inflows and outflows in the future. - normally found in business’s plan
8
Q
what is a cash flow statement
A
its a backwards looking statement that shows what happened to cash inflows and outflows - normally found in business’s accounts
9
Q
what does net cash flow show
A
shows the cash inflows and outflows each month
