Which of the following describes the cash budget?
A) It helps in planning to ensure the business has adequate cash.
B) It aids in planning to ensure the company has adequate inventory on hand.
C) It captures the variable and fixed expenses of the business.
D) It depicts the breakdown of sales based on terms of collection.

Question

Quizplus · Accepted Answer

The cash budget is a financial tool that analyzes the inflow and outflow of cash within a business over a specified period. It helps the company to identify potential gaps between cash inflows and outflows, thereby enabling the organization to plan adequately and ensure that it has adequate cash available to meet its obligations.

Which of the Following Describes the Cash Budget