A cash budget is a plan of the cash balances in the future, taking into account the forecast revenues and expenses.
We need to factor all revenue received and expenses to determine that we will have sufficient money in the bank account at the end of the period.
This is the cash budget format
| Beginning cash balance | ||
| plus | Cash inflows | |
| equals | Total cash available | |
| less | Cash outflows |
Here is an example of how a cash budget can be constructed from revenues and expenses.
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