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Business Studies, Break even Point, INFLOW-OUTFLOW = Net cash flow -…
Business Studies
Short term sources
Trade Credit
Short Term Loans like Working Capital Loans from Commercial Banks
Fixed Deposits for a period of 1 year or less
Advances received from customers
Creditors
Payables
Factoring Services
Bill Discounting etc.
Short-term sources of finance are those which are used for raising funds for short period of time that is less than one year. Money raised through short term source is required to be paid back within one year.
What is INFLOW?
: Reinvested Profit, sales revenue financial investors, loans from banks , grants , shareholders
What is OUTFLOW?
Tax, Bills + overheads,
stocks,
raw materials,
wages/salaries, Rent, petrol , insurance ,
advertisement , loan repayment new machinery
Closing Balance
The closing balance is the amount of money the business has at the end of the reporting period, usually the last day of the month: closing balance = net cash flow + opening balance For example: net cash flow = £2,550
Sales Revenue = When money flows into the business when income is received
Fixed and Variable Costs = Money flows out of a business when payments are made
Why do business use cash flow? =
.Predict sales and expenses of a business
Avoid cash problems
Helps make decisions : E.G -To expand Business
Introduce new products / services
-Buy machinery
STRUCTURE OF A CASH FLOW FORECAST:
Opening balance = Money you start off at the start
Inflow (list items) . Totalin
Business
Interests
means all of the issued and outstanding ownership interests of Coronado. Business Interests means the direct and indirect equity interests in the Business held by the Partnership including, without limitation, the equity interests in Stinson, Canadian Purchaser, and Sea Value.
Break even Point
Formulae for break even Point: FIXED COST / SELLING PRICE - VARIABLE COSTS PER UNIT OF OUTPUT
The break even point is the production level where total revenues equals total expenses
In investing, the break even point is the point at which the original cost equals the market price.
INFLOW-OUTFLOW = Net cash flow