30. Glossary Flashcards
Cash flow
Definition
the sum of cash payments to a business less the sum of cash payments from the business.
Insolvent
Definition
when a business cannot meet its short-term debts.
Cash flow forecast
Definition
an estimate of the future cash inflows and outflows of a business.
Cash inflow
Definition
cash payments into a business.
Cash inflow
Definition
cash payments into a business.
Cash outflow
Definition
cash payments out of a business.
Net cash flow
Definition
estimated difference between cash inflows and cash outflows for the period (for example one month).
Opening cash balance
Definition
cash held by the business at the start of the month.
Closing balance
Definition
cash held by the business at the end of the month, which becomes next month’s opening balance.
Credit control
Definition
monitoring of debts to ensure that credit periods are not exceeded.
Bad debt
Definition
unpaid customers’ bills that are now very unlikely to ever be paid.
Overtrading
Definition
expanding a business rapidly without obtaining all of the necessary finance, resulting in a cash flow shortage.
