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Financial Forecasting and Planning, IMPORTANT, Point to remember!, Why…

- - - - cash planning
        
        preparation of the firm’s cash budget
      - profit planning
        
        usually done by means of pro-forma financial statements
- - - - Step 1- state a cash receipt
        Step 2- less cash disbursement
        Step 3 - get net C/F
        Step 4 - less interest
        Step 5 - Add: Beginning Cash
        Step 6 - get Ending Cash
        Step 7 - Less Minimum Cash Balance
        Step 8 - Required total Financing -if any (notes payable)
        Step 9 - Excess Cash Balance (invest in mktb securities)
        
        cash receipt
        
        Forecasted sales
        
        Cash Sales
        Collection of Account Receivable eg:
        
        Other cash receipts-dividend receipts & etc
        
        Cash disbursement
        
        Purchases
        Rent payment
        Wages salaries
        Tax payment
        fixed asset
        interest payment
        divident payment
        loan
        Renovation
        Other cash disbursement