BU121 Lecture Notes - Lecture 8: Cash Flow
Document Summary
Tool to forecast and manage cash flows: helps you to determine what you need in terms of cash and manage it, **10 marks on final exam** Receipts: what you have/ expect to have coming in. Disbursements: what you have/ expect to have going out. You should always compare expected cash amount to minimum cash balance: to create a cushion if something comes up. Ending cash balance = beginning cash balance of next month. Worksheet based on historical measures of amounts and timing of cash flows. 3 possibilities (besides excess = balance required: 1. Some of the borrowings needed to cover bills so you may have borrowed more than the minimum required: 2. You can choose how much to allocate toward repayment. If you do use all of it to repay, ending balance = minimum required. If you don"t, ending balance = total excess: 3.
