Account

Accounting
Date: 12/10/2012

Cash pass Management
Having not much liquidity, it might cause a job by not being able to meet the financial needs. On the other hand, having too much currency in hand as well is a problem as you need to invest it on something. As much interchange in hand does not bring any taxation in any business.
at that placefore, there should be a counterpoise between profitability and liquidity. For example if a company has through with(p) Rs 1000 of profit it does not mean, it is liquid. It needs to be checked. There might be debts, creditors and such related things.

Example 1:
Ms Cooper operates a beauty front room in Quatre Bornes. She wants you to help her to prep are the forecasts for the expansion of the business in a beauty clinic. She provides with the spare-time activity information for the 12 month polish 31 October 2013. Her monthly sales would be Rs 400,000 for the first 5 month, Rs 1,000,000 for 3 month and Rs 800,000 thereafter. She also forecasts that she would receive a cash gift of Rs 1,000,000 in February on the occasion of her engagement to Brad.




She forecasts that the following would be spent during the coming year. Expenses representing 60% of sales are payable 40% in the latest month and the end in 2 equal successive months.
She also would bind salaries of Rs 100,000 every month, a bonus of Rs 50,000 payable in declination and commissions on sales of 15% payable in the current month.
Prepare a cash flow forecast for Ms Cooper, taking into account that she needs to invest Rs 1,000,000 to upgrade her parlour and this amount will be payable in 4 monthly installments starting December 2012.If you want to get a full essay, order it on our website: Ordercustompaper.com



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