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Unformatted text preview: • How does a personal cash flow statement help you organize your finances? It shows me where the money is coming from, what financial commitments I have to allow for and where my money is going to. It also allows me to budget for holidays and unforeseen expenses such as repairs, unexpected death or injury. If I have less money coming in than I need to cover the expenses going out then it will help me to see where cuts can be made to balance the accounts. It’s just like a net worth statement, a positive number is positive cash flow (good!) and a negative number is negative cash flow (bad!).A cash flow statement is designed to list all sources of income that affect your cash flow, not just your salary from your day job. On the same token, you need to record all expenses, including regular and irregular expenses. For example, some of your expenses may come quarterly, semi-annually, or annually. It is always best to live within our income and never rely on credit from credit cards or loans except for large items such...
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This note was uploaded on 05/08/2011 for the course ALL 101 taught by Professor Grecthem during the Spring '11 term at University of Phoenix.
- Spring '11