Which of the following items should a company explicitly include in its monthly cash budget?
A) Its monthly depreciation expense.
B) Its cash proceeds from selling one of its divisions.
C) Interest paid on its bank loans.
D) Statements b and c are correct.
E) All of the statements above are correct.

Question

Quizplus · Accepted Answer

The monthly cash budget should include both the interest paid on bank loans (statement c) and the cash proceeds from selling one of its divisions (statement b) since these are significant cash inflows/outflows. However, monthly depreciation expense (statement a) is a non-cash expense and should not be explicitly included in the monthly cash budget.

Which of the Following Items Should a Company Explicitly Include