What information is reflected on the cash budget?
A)all revenues and all expenses for a period
B)the expected cash receipts and cash disbursements from all sources
C)all the amounts that appear on a budgeted income statement
D)all the revenues and cash inflows and all expenses and cash outflows for a period

Question

Quizplus · Accepted Answer

The cash budget reflects the expected cash receipts and cash disbursements from all sources, including both operating and non-operating activities. It provides a detailed breakdown of expected cash inflows and outflows for a specific period, typically a month or a quarter. While it is closely related to the budgeted income statement, it focuses specifically on cash transactions rather than accrual accounting items. Therefore, choice A and C are too narrow or too broad, respectively. Choice D is also too broad, as it includes all revenues and expenses regardless of whether they involve cash or not.

What Information Is Reflected on the Cash Budget