Business Survival and Cash Flow (CH 22) Flashcards
1
Q
Liquidity Meaning
A
Having sufficient cash available. (also assets that can be converted into cash)
2
Q
What is a Cash Flow Forecast?
A
Monthly prediction of timing of expected cash inflows and outflows for a firm
3
Q
Cash Inflow examples
A
- Revenue
- Investment
- Borrowing
4
Q
Cash Outflow examples
A
- Fixed Costs
- Variable Costs
- Cash withdrawals from owner
- Employee expenses
5
Q
What is the Relationship like between opening balance and closing balance between months?
A
Closing Balance= Opening Balance
6
Q
Net Cash flow Formula
A
Cash inflow - Cash outflow
7
Q
Closing Balance Formula
A
Net Cash Flow + Opening Balance = Closing Balance
