Forecasting the amount of cash that will be available after paying expenses is straightforward because it's always equal to the firm's "bottom line"-the net profit figure shown on the operating statement.

Question

Quizplus · Accepted Answer

Forecasting the amount of cash that will be available after paying expenses is not always straightforward because there are many factors that can affect cash flow, such as changes in accounts receivable, inventory levels, and capital expenditures. Net profit on the operating statement is not necessarily equal to the amount of cash available after paying expenses, as it does not take into account non-cash expenses like depreciation and changes in working capital.

Forecasting the Amount of Cash That Will Be Available After