Account

Accounting Date: 12/10/2012 Cash give back Management Having not more liquidity, it might cause a job by not being able to get word the financial postulate. On the other hand, having too much specie in hand as well is a riddle as you need to invest it on something. As much interchange in hand does not bring whatever 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 tie in things. Example 1: Ms Cooper operates a hit front room in Quatre Bornes. She wants you to help her to prep ar the forecasts for the expansion of the business in a beauty clinic. She provides with the spare-time natural process information for the 12 calendar month polish 31 October 2013. Her periodic gross 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 pass 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 accounting system that she needs to invest Rs 1,000,000 to upgrade her parlour and this amount result be payable in 4 monthly installments commencement December! 2012.If you want to get a full essay, coiffe it on our website: OrderEssay.net

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