The cash budget is the primary short-run financial planning tool. The key reason

Question

The cash budget is the primary short-run financial planning tool. The key reasons a cash budget is created are:
A. To estimate the size and timing of your new cash flows B. To prepare for potential financing needs C. To estimate your investment in assets D. a. and b E. b. and c The cash budget is the primary short-run financial planning tool. The key reasons a cash budget is created are:
A. To estimate the size and timing of your new cash flows B. To prepare for potential financing needs C. To estimate your investment in assets D. a. and b E. b. and c
A. To estimate the size and timing of your new cash flows B. To prepare for potential financing needs C. To estimate your investment in assets D. a. and b E. b. and c

Explanation / Answer

In cash budget we generally show, Cash from sales, cash received from debtors, cash payments to creditors, cash payments to cash purchases. With cash budget, we can identify the potential financing needs in short term and in long term as well. We can also about the timing of the cash flows that could be even cash inflow and cash outflow.

Therefore, the roght answer is Option (D).

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