Cash budget

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  • Created by: josief95
  • Created on: 13-12-15 14:42

1. Accounting Rate of Return (ARR) =

  • Av. annual operating profit / av. investment to earn that profit x100
  • Average annual investment = cost of initial investment + disposal value /2
  • Average annual profit = total profit over life of investment/ number of years of investment
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2. Inventories budget includes (down vertical axis):

  • Opening balance; Purchases : Inventories used: Closing balance
  • Cash balance; Purchases : Inventories used: Closing balance
  • Bank over draft; Purchases : Inventories used: Closing balance

3. Under Net (At bottom of cash budget)

  • Cash balance B/f = Brought forward; Cash balance c/f = Closing figure
  • Nothing

4. What is a budget?

  • a financial plan of operation or entity for a period of time usually one year.
  • a financial plan of operation or entity for a period of time usually 50 years.
  • a logistical plan of operation or entity for a period of time usually one year.

5. Horizontal axis

  • Price
  • Months; total
  • Sub headings

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