Читать книгу Financial Accounting For Dummies - Maire Loughran - Страница 71

Preparing and using a cash budget is your best friend for identifying potential cash shortfalls. Keep in mind that a cash budget doesn’t exist in a vacuum; it flows from many other sources, such as your balance sheet and operating budget.

Figure 3-3 is a simple cash budget that Izzie put together for January and February 2022. Depending on the type of retail, fourth quarter, which encompasses the holiday season, usually provides killer revenue.

FIGURE 3-3: Cash budget.

First quarter of the year is usually not all that great sales-wise plus all those pesky returns from holiday gift-giving! So, Izzie wants to make sure that she has enough cash left over from December to cover her expenses in January and February.

Looking at the cash budget, you can see that Izzie’s sales forecast is relatively accurate when smoothed out between the two months. January’s ending cash balance was a squeaker, but her budget shows her still in the green.

The issue is the $(10,872) February cash shortfall. Looking at the budget, Izzie has to do some planning. One option for conquering the shortfall is being more conservative with January purchases made on account.

To that end, maybe cut down on impulse purchases or not invest in more inventory just because the vendor has markdowns. She could also consider slowing down the payment of accrued expenses or accounts payable (see Part 3) or go to her bank for a short-term loan.