ECONOMICS (CBSE/UGC NET)

ECONOMICS

ENTREPRENEURS

Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
An entrepreneur should prepare a cash flow statement
A
daily
B
monthly
C
quarterly
D
yearly
Explanation: 

Detailed explanation-1: -The cash flow statement should be prepared on a monthly basis during the first year, on a quarterly basis for the second year, and annually for the third year.

Detailed explanation-2: -“Cash flow” refers to the money that moves both in and out of your business each month. It’s one of the strongest indicators of the financial health of your business.

Detailed explanation-3: -In some cases, accounting professionals recommend that you prepare a cash flow statement every month because, for many businesses, monthly billings are usual, and operating expenses-such as rent and wages-are often paid monthly. In other circumstances, quarterly cash flow statements may work.

Detailed explanation-4: -Decide how far out you want to plan for. Cash flow planning can cover anything from a few weeks to many months. List all your income. For each week or month in your cash flow forecast, list all the cash you’ve got coming in. List all your outgoings. Work out your running cash flow.

There is 1 question to complete.