Get help now
  • Pages 2
  • Words 384
  • Views 344
  • Download

    Cite

    Kip
    Verified writer
    Rating
    • rating star
    • rating star
    • rating star
    • rating star
    • rating star
    • 5/5
    Delivery result 2 hours
    Customers reviews 234
    Hire Writer
    +123 relevant experts are online

    To What Extent Would Drawing Up a Cash Flow Forecast Essay

    Academic anxiety?

    Get original paper in 3 hours and nail the task

    Get help now

    124 experts online

    These objectives may consist of a break even chart or in general, a strong positive cash flow. This can be achieved with having an organized cash flow forecast. It may be difficult for a new business to forecast sales because there is no previous data to base the predictions on. This means that it needs to be as accurate as possible however, you cannot predict the future so therefore the cash flow forecast is only as good as the sales prediction and as good as the cost estimates.

    In reality the predictions may not be true, This means that further down the line, the forecast may not be as accurate as originally thought when it was drawn up The main objective for the newly established businesses will be to survive as a business. Taking aside the short or long term success, surviving will be the main priority. Along with this, managing cash is also important. The cash flow forecast will enable the business owner to see how the cash is managed and Whether an overdraft from the bank is needed and if an overdraft facility s needed.

    It will also highlight any immediate problems which will have to be sorted out. Another problem is that it doesn’t tell you anything about profitability and focuses purely on cash so you don’t really know a long term target. To overcome this I would suggest to draw up a Break-even plan as this focuses on sales and when losses turns into profit. This accompanied by a cash flow forecast would ensure an overall management and understanding of where the money coming in and out of the business is coming and going and in what quantity.

    To accompany these two documents, a business plan may be useful if the business owner was to go to a bank or potential investor, In conclusion, a cash flow forecast is a useful document as it shows where the expenditure for day to day expenses are going and where they are coming from. If one is accompanied by a break even plan (highlighting sales, profits and costs) and a business plan, there is an overall cash, cost and profit overview which can be managed. To What Extent Would Drawing Up a Cash Flow Forecast Increase the Chances of This Business Being Successful?

    This essay was written by a fellow student. You may use it as a guide or sample for writing your own paper, but remember to cite it correctly. Don’t submit it as your own as it will be considered plagiarism.

    Need custom essay sample written special for your assignment?

    Choose skilled expert on your subject and get original paper with free plagiarism report

    Order custom paper Without paying upfront

    To What Extent Would Drawing Up a Cash Flow Forecast Essay. (2018, May 26). Retrieved from https://artscolumbia.org/to-what-extent-would-drawing-up-a-cash-flow-forecast-48135/

    We use cookies to give you the best experience possible. By continuing we’ll assume you’re on board with our cookie policy

    Hi, my name is Amy 👋

    In case you can't find a relevant example, our professional writers are ready to help you write a unique paper. Just talk to our smart assistant Amy and she'll connect you with the best match.

    Get help with your paper