Shorter-term cash budgets¾say a daily cash budget for the next month¾are generally used for actual cash control while longer-term cash budgets¾say monthly cash budgets for the next year¾are generally used for planning purposes.

Question

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Shorter-term cash budgets are used for actual cash control because they provide a detailed plan for daily cash inflows and outflows. Longer-term cash budgets are used for planning purposes because they allow businesses to anticipate their future cash needs and make strategic decisions accordingly.

Shorter-Term Cash Budgets¾say a Daily Cash Budget for the Next