The primary purpose of a cash budget is to
A) determine the level of investment in current and fixed assets.
B) determine accounts payable.
C) provide a detailed plan of future cash flows.
D) determine the estimated income tax for the year.

Question

Quizplus · Accepted Answer

The primary purpose of a cash budget is to provide a detailed plan of future cash flows. It helps in managing cash inflows and outflows, ensuring that there is enough cash available to meet financial obligations and investments. A cash budget also helps in identifying potential cash shortages or surpluses, allowing businesses to take appropriate measures to address them.

The Primary Purpose of a Cash Budget Is to