Please enable JavaScript.
Coggle requires JavaScript to display documents.
Cash-Flow forecasting - Coggle Diagram
Cash-Flow forecasting
Cash-flow
The amount of money that gets in and out of the business
Difference between cash and profit
profit
The amount of money the business has made after substracting all costs
Cash
the amount of money the business has
Importance of Cash flow
Prevent business failure (insolvency- inability to pay debts)
The business needs cash to survive
Shows banks that the business can be trusted
Uses of cash flow
Helps obtain loans
Easy to spot problems
The business decides what they want to do with the excess cash
liquidity
How fast can you get your money/revenue
liquid
An object easely turned into cash exp:asset, mortage...
Purpose of cash flow
supporting applications for funding
Before lending money, a bank will want to see the cash flow of the company. Better cash flow will result on better options for
leaning
Help with planning the business
Identifying cash shortages
Monitoring cash flow
Cash inflow and outflow
Cash inflow
Money that enters the business
Exp: sales
Cash outflow
Money that exits the business
Exp: paying employees
Net cash flow
cash inflow + cash outflow
Allows the business the money they can make
Opening and closing balance
Opening balance
The amount of cash a business has at the begining of the month
Closing balance
The amount of cash the business has at the end of the month
Cash flow forecast chart
It allows the business to see the cash that will get in and out o its business
https://www.google.com/url?sa=i&url=https%3A%2F%2Fdebitoor.com%2Fdictionary%2Fcash-flow-forecast&psig=AOvVaw3wP3bVx6yE2TM3Lgnz6F3r&ust=1717236034804000&source=images&cd=vfe&opi=89978449&ved=0CBIQjRxqFwoTCJDp8e_Qt4YDFQAAAAAdAAAAABAE
![Screenshot 2024-06-03 16.14.48](attached://0ba206cbde939c90f5983369c079