•A cash flow forecast is the day-to-day running of a business budget
Cash inflow one the money recived from the business such as products sales
Cash outflow are the sums of money paid out by a business such as raw materials and wages
Day to day spending is working capital
When customers buy a product the business may not get the money straight away due to the customer having the product in credit meaning that they can play later
Established firms can base forecasts on past experience where’s new business cAnt
Managers use cash flow to make sure that they always have enough money to pay suppliers and employees
Cash flows can be included in business plans
Not always accurate and need a lot of experience and research in it as well
Cash flows are hard to predict in a dynamic market
A inaccurate forecasts can lead to the business running it if money and ending up insolvent ( can’t pay there debts) leading to the business closing down