A small business whose sales are highly variable, such as a seasonal business, should use a short cash planning horizon.

Question

Quizplus · Accepted Answer

A short cash planning horizon, such as a few weeks or months, is appropriate for a small business with highly variable sales. This allows for more accurate cash flow forecasting and better management of short-term cash needs. A longer planning horizon may not be as effective as sales may fluctuate greatly during that period, making it difficult to predict cash inflows and outflows.

A Small Business Whose Sales Are Highly Variable, Such as a Seasonal