A cash budget is a tool the treasurer uses to forecast future cash flows and estimate future short-term borrowing needs.

Question

Quizplus · Accepted Answer

This statement is true. A cash budget is a financial planning tool that helps the treasurer predict the inflows and outflows of cash in the business and determine whether there will be a surplus or deficit of cash. This information is then used to plan for short-term borrowing needs, such as a line of credit or a short-term loan, to cover any potential cash shortfalls.

A Cash Budget Is a Tool the Treasurer Uses to Forecast