Suggest even dollars be used rather than showing cents.
Next fill in the pre-start-up position of the essential operating data [non-cash flow information], where applicable.
Complete the spreadsheet using the suggestions for each entry, provided in the partial spreadsheet on the next worksheet.
A cash flow projection is a forecast of cash funds a business anticipates receiving and paying out throughout the course of
a given span of time, and the anticipated cash position at specific times during the period being projected.
[For the purpose of this
projection, cash funds are defined as cash, checks, or money order, paid out or received.]
The purpose of preparing a cash flow projection is to determine shortages or excesses in cash from that necessary to
operate the business during the time for which the projection is prepared.
If cash shortages are revealed in the project, financial plans
be altered to provide more cash until a proper cash flow balance is obtained.
For example, more owner cash, loans, increased
selling prices of products, or less credit sales to customers will provide more cash to the business.
Ways to reduce the amount of cash
paid out includes having less inventory, reducing purchases of equipment or other fixed assets, or eliminating some operating
If excesses of cash are revealed, it might indicated excessive borrowing or idle money that could be "put to work." The
objective is to
develop a plan which, if followed, will provide a well-managed flow of cash.
The cash flow projection worksheet in this file provides a systematic method of recording estimates of cash
receipts and expenditures, which can be compared with actual receipts and expenditures as they become known.
The entries listed in
the spreadsheet will not necessarily apply to every business, and some entries may not be included which would be pertinent to
It is suggested, therefore, that you adapt the spreadsheet to the particular business for which the projection is
being made, with appropriate changes in the entries as required.
Before the cash flow projection can be completed and a pricing
structure established, it is necessary to know or to estimate various important factors of the business, for example:
What are the direct costs of the product or services per unit?
What are the monthly or yearly costs of the operation?
What is the sales price per unit of the product or service?
Determine that the pricing structure provides this business with reasonable
breakeven goals [including a reasonable net profit] when conservative sales goals are met.
What are the available sources of cash, other than income from sales; for example, loans, equity capital, rent, or other sources?