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which budgeting takes place, the mechanical aspects of building a budget, and a description of seven important
linkages between the budget and other organizational activities.
Chapter 10. Cash Budgeting
Preparation of the cash budget is largely an accounting function that is driven by the combination of the capital
and operating budgets (discussed in the two previous chapters). However, to the extent that the cash budget indicates some anticipated cash shortfalls, senior management needs to become involved in determining the approaches
that the organization will take to raise the requisite funds. In particular, the chapter focuses on the choices that managers make about (a) the use of debt or equity to finance assets, (b) the structure of debt, (c) the magnitude of net
income, and (d) the management of growth. The chapter relates the capital budget (which emerges from the programming phase discussed in Chapter 8) and the operating budget (discussed in Chapter 9) to cash forecasts. The
chapter concludes with a description...
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This document was uploaded on 03/30/2014.
- Spring '14