A simple listing of expected cash inflows and outflows provides the entrepreneur with a(n)
A) income statement.
B) cash budget.
C) pro forma balance sheet.
D) net equity computation.

Question

Quizplus · Accepted Answer

A simple listing of expected cash inflows and outflows is a cash budget. This budget helps the entrepreneur to plan and manage their cash flow effectively, ensuring they have enough cash on hand to meet their obligations and invest in growth opportunities. An income statement shows revenues, expenses, and earnings over a certain period, while a pro forma balance sheet presents projected assets, liabilities, and equity at a certain point in the future. Net equity computation involves calculating the value of a company's equity after subtracting liabilities, which is not directly relevant to cash flows.

A Simple Listing of Expected Cash Inflows and Outflows Provides