Cash flow

Question 1

Advantages of cash flows

Answer 1

Can determine if finance is needed by assessing cash situation (finds shortages and surpluses)
Can adapt and plan for high outflows

Question 2

Net cash flow

Answer 2

Cash inflows- Cash outflows

Question 3

Opening Balance

Answer 3

Last months clothing balance

Question 4

Disadvantages of Cash flow

Answer 4

It is a prediction

Unexpected costs we can’t plan for

Question 5

Ways to improve cashflow (In order of most important to least)

Answer 5

1. Reduce Outflows
2. SOF e.g. Overdraft
3. Try to improve inflows (buy may increase outflows)