ENTR 3P96 Chapter Notes - Chapter 6: Cash Cash, Net Income, Retained Earnings

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Describe how projected statements of cash flow relate to cash budgets. Explain why projected statements of cash flow are important to the entrepreneur. Understand the concept of a sustainable sales growth. Understand the process of identifying the quantity and timing of additional funds needed to support the venture"s sales forecasts. Connect sales growth rates to the amount and timing of additional funds needed. Describe the percent-of-sales method for preparing financial plans. As a check on the cash budget, you can get the exact same cash balance by constructing a full set of financial statements. See exhibits 6. 3 6. 5 in the textbook. Forecasting for early stage ventures (firms that are in either their development, start-up, or survival stage, or just entering into their rapid growth stage of their life cycle) Internally generated funds: net income or profits after taxes earned over an accounting period.