The cash budget and the capital budget are handled separately, and although they are both important, they are developed completely independently of one another.

Question

Quizplus · Accepted Answer

While the cash budget and the capital budget have different focuses and serve different purposes, they are related and should be developed in conjunction with one another. The capital budget outlines planned investments and expenditures, while the cash budget projects the inflows and outflows of cash to ensure there is enough available to fund those investments. Therefore, they should be coordinated and complementary.

The Cash Budget and the Capital Budget Are Handled Separately