cash budget
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Cash budget
Submitted byVijay dilip somase
Guided by Prof khairnar mam
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Cash Flow BudgetingCash flow budget used for?
What items are included in cash inflows and cash outflows?
What adjustments can be made in cash balance?
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A cash budget is prepared to
Monitor the timing of cash IN cash OUT Make sure there is enough cash
available See if and when a bank overdraft is
required Plan the timing of the purchase of a
fixed assetsAvoid a negative cash flow situation
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Methods Of Cash Budget
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Cash InflowsSales and other cash incomeNew loans receivedSales of capital assetsNonfarm incomeBeginning cash on hand
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Cash OutflowsCash expensesPrincipal paymentsPurchase of capital assetsNonfarm expensesEnding cash on hand
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Do not include:DepreciationOpportunity costsAny other noncash income or expense
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Cash Flow Budgets Can Be:
Annual Quarterly Bi-monthly Monthly
1. Estimate cash inflows and outflows for the entire year first.
2. Distribute the annual totals among the periods within the year.
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Preparation of cash budget
Estimating cash receipts
Cash sales Collection from debtors Interest / dividends on investment Sale of assets etc Loans, advances, deposits, etc
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Preparation of cash budget
Estimating cash payment
Payment for purchases Payment of overheadsPurchase of assets Payment of creditors Payment for taxes Payment for dividends/interest etcRepayment of loan / advances / deposits etc
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Budget within the year
Jan-Feb
Mar-Apr
May-June
July-Aug
Sep-Oct
Nov-Dec
CashInflows- Cash Outflows= Balance
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THANK YOU THANK YOU