Download the spreadsheet that shows the projected receipts and payments
for a business that is about to start up. Complete the cash flow forecast
by ensuring that the values for total receipts, total payments, net
cash flow, opening and closing balances are entered. Then answer
the following questions:
What is the expected closing balance for March?
In which month is the business expected to have a negative closing
balance?
Write a letter to Mr Jones and explain to him what you have learned
from looking at his forecast. Suggest some strategies he might like
to pursue to avoid liquidity problems. For each of your suggestions,
discuss the possible advantages and disadvantages.
Conclude your letter by choosing your preferred strategy. Explain
your choice.
Is there any other information you would like to have in order to
make judgements about the best strategy for the business?
