Archive for the ‘Cash flow’ Category

This issue of cash flow will solve one of the key questions of any project, undertaking or evaluating a business proposal or Promotional, how much money is needed? and if we can fund it at that level or we can make it even bigger or should decrease, if the cash flow shows that we need 200 million and after an analysis we find that our Uncle Frederick has only 100 million and we can get a bank loan only 20 million, there we have an insurmountable limitation and we rethink the project with the financial capabilities we have.

Cash flow is the presentation on a table, figures for various periods into the future, and for different items or factors, when will you get in or out, physically, money.

The main objective of cash flow estimation, by period, the net result of cash income less money orders, ie, at what period will be over or missing money and this process allows us to identify the need for working capital and how, to make decisions about what to do:

Or invest in a big, when there is excess cash, or get the money needed to operate either with partners or funders.

The cash flow table has many columns as periods (years, months or weeks) to go to establish the Revenue and Expenditure of money, and as many rows as items or factors whose income or expenses are to be projected. The figures contained in the “Cash Flow” are the result of detailed calculations of them has been done in other tables. Cash Flow contains only cash movements (input or output) in cash recorded in the period that is expected to occur physically.

If there is a cost that is not rotated, as the “Depreciation” is not included in it.

Cause Effect Relationship

In a company for a sale income or expense of raw materials or personnel, is “cause” or accounted for in the income statement to calculate the value of the company (revenues minus costs) when they made the commitment to pay .

The sales revenue recorded in the Income Statement, or “cause” in the period in which the seller makes the sale or “emits” the bill, although the sale has been made on credit and therefore the money is going to receive later. (30, 60 or more days later).

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