The key to managing a cash flow is to
A) pad the price of the bid on project proposals to cover contingencies.
B) add a sizable profit to the proposal after estimating direct and indirect costs.
C) optimistically plan the budget to win more contracts.
D) ensure that cash comes in faster than it goes out.

Question

Quizplus · Accepted Answer

Managing cash flow means ensuring that more cash is coming in than going out. This can be achieved by invoicing promptly and following up on payments, negotiating favorable payment terms with suppliers, monitoring and controlling expenses, and forecasting cash flow to plan for any potential shortfalls. Padding the price or adding excess profit margins can actually deter clients and reduce the chances of winning contracts. Similarly, optimistic budget planning can leave the business vulnerable to unexpected expenses and cash flow issues.

The Key to Managing a Cash Flow Is to