Cash Inflows And Outflows Flashcards
1
Q
Give examples of cash inflows/receipts
A
Cash sales
Credit sales
Loans
Capital introduced- owners capital
Sale of assets
Bank interest received
2
Q
Give examples of cash outflows
A
Cash purchases
Credit purchases
Rent
Rates
Salaries
Wages
Utilities
Purchase of assets
VAT
Bank interest paid
3
Q
2 Advantages of cash flow forecasting
A
Timings of inflows and outflows are known
Expensive items can be bought at the best time
4
Q
2 disadvantages of cash flow forecasts
A
Based on forecasts and therefore may be inaccurate
Takes a long time to produce whilst the time taken could’ve been spent on other tasks
5
Q
What are two ways to improve cash inflows
A
Offer discounts for quick payment
Chase up late payments
6
Q
What is 1 way to reduce outflows
A
Delay payments to suppliers
