Cash Flow Statement - Example 2

Murray Wilson's 200Y Forecasted Cash Flow Statement:

Below illustrates Murray's 200Y Forecasted Cash Flow Statement.  You may click on the highlighted text (left hand side of your screen) to find out which Financial Budget was used to arrived at the monthly values/numbers.  Please Note:   For presentational purposes we have divided Murray's 200Y Cash Flow Statement into two parts, namely, January to July and August to December.

SCHOLARSHIP INFORMATION SERVICES
FORECASTED CASH FLOW STATEMENT
FOR YEAR ENDING DECEMBER 31, 200Y

JAN FEB MAR APR MAY JUN JULY.
ASSUMPTIONS:






Forecasted Yearly Sales (units) 8000 8000 8000 8000 8000 8000 8000
Monthly Sales Percentages 12% 11% 9% 9% 7% 5% 4%
Units Sales per Month 960 880 720 720 560 400 320
Selling Price Per Unit Sold $24 $24 $24 $24 $24 $24 $24
Cost per product purchased $3.30 $3.30 $3.30 $3.30 $3.30 $3.30 $3.30

CASH INFLOWS:






From Sales $23,040 $21,120 $17,280 $17,280 $13,440 $ 9,600 $ 7,680
Cash at Beginning of Month $10,373 $14,069 $17,850 $20,293 $20,440 $21,071 $18,390
Total Cash Available $33,413 $35,189 $35,130 $37,573 $33,880 $30,671 $26,070

CASH DISBURSEMENTS:






For Direct Material Purchases $2,736 $2,930 $2,429 $2,376 $1,901 $1,373 $1,082
For Promotional Pamphlets $ 0 $2,000 $ 0 $ 0 $ 0 $ 0 $ 0
For University Advertising $1,500 $1,500 $1,500 $1,500 $ 0 $ 0 $ 0
For Newspaper Advertising $2,917 $2,917 $2,917 $2,917 $2,917 $2,917 $2,917
For Office Salaries $3,033 $3,033 $3,033 $3,033 $3,033 $3,033 $3,033
For Employer Costs $ 334 $ 334 $ 334 $ 334 $ 334 $ 334 $ 334
For Office Supplies $3,000 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
For Business Cards, etc. $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
For Printing of Checks $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
For Telephone $ 200 $ 200 $ 200 $ 200 $ 200 $ 200 $ 200
For Legal Fees $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
For Message Centre $ 717 $ 717 $ 717 $ 717 $ 717 $ 717 $ 717
For Toll Free Services $1,600 $1,600 $1,600 $1,600 $1,600 $1,600 $1,600
For Credit Card Service $ 768 $ 768 $ 768 $ 768 $ 768 $ 768 $ 768
For Bank Charges $ 40 $ 40 $ 40 $ 40 $ 40 $ 40 $ 40
For Miscellaneous $ 300 $ 300 $ 300 $ 300 $ 300 $ 300 $ 300
For Income Taxes $ 0 $ 0 $ 0 $2,349 $ 0 $ 0 $ 0
For Cash Drawings by owner $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000
For Equipment Purchased $1,200 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
Total Disbursements $19,344 $17,339 $14,837 $17,133 $12,809 $12,281 $11,991

ENDING CASH BALANCE $14,069 $17,850 $20,293 $20,440 $21,071 $18,390 $14,080
NOTE: Figures are rounded to the nearest dollar.

 

The remaining five (5) months of Murray's 200Y Forecasted Cash Flow Statement is as follows (August to December).  Please Note:  the "TOTALS" column represents the entire forecasted year of 200Y (i.e.  January through to December 200Y).

SCHOLARSHIP INFORMATION SERVICES
FORECASTED CASH FLOW STATEMENT
FOR YEAR ENDING DECEMBER 31, 200Y

AUG SEPT. OCT. NOV. DEC. TOTALS
ASSUMPTIONS:





Forecasted Yearly Sales (in units) 8000 8000 8000 8000 8000 8000 units
Monthly Sales Percentages 9% 8% 5% 11% 10% 100%
Units Sales per Month 720 640 400 880 800 8000 units
Selling Price Per Unit Sold $24 $24 $24 $24 $24
Cost per product purchased $3.30 $3.30 $3.30 $3.30 $3.30

CASH INFLOWS:





From Sales $17,280 $15,360 $ 9,600 $21,120 $19,200 $192,000
Cash at Beginning of Month $14,080 $18,208 $19,021 $14,814 $20,780
Total Cash Available $31,360 $33,568 $28,621 $35,934 $39,980

CASH DISBURSEMENTS:





For Direct Material Purchases $2,244 $2,138 $1,399 $2,745 $2,666 $26,021
For Promotional Pamphlets $ 0 $ 0 $ 0 $ 0 $ 0 $ 2,000
For University Advertising $ 0 $1,500 $1,500 $1,500 $1,500 $12,000
For Newspaper Advertising $2,917 $2,917 $2,917 $2,917 $2,917 $34,998
For Office Salaries $3,033 $3,033 $3,033 $3,033 $3,033 $36,400
For Employer Costs $ 334 $ 334 $ 334 $ 334 $ 334 $ 4,004
For Office Supplies Expense $ 0 $ 0 $ 0 $ 0 $ 0 $ 3,000
For Business Cards, etc. $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
For Printing of Checks $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
For Telephone $ 200 $ 200 $ 200 $ 200 $ 200 $ 2,400
For Legal Fees $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
For Message Centre $ 717 $ 717 $ 717 $ 717 $ 717 $ 8,600
For Toll Free Services $1,600 $1,600 $1,600 $1,600 $1,600 $19,200
For Credit Card Service $ 768 $ 768 $ 768 $ 768 $ 768 $ 9,216
For Bank Charges $ 40 $ 40 $ 40 $ 40 $ 40 $ 480
For Miscellaneous $ 300 $ 300 $ 300 $ 300 $ 300 $ 3,600
For Income Taxes $ 0 $ 0 $ 0 $ 0 $ 0 $ 2,349
For Cash Drawings by owner $1,000 $1,000 $1,000 $1,000 $1,000 $12,000
For Equipment Purchased $ 0 $ 0 $ 0 $ 0 $ 0 $ 1,200
Total Disbursements $13,152 $14,547 $13,807 $15,154 $15,075 $177,468

ENDING CASH BALANCE $18,208 $19,021 $14,814 $20,780 $24,905
NOTE: Figures are rounded to the nearest dollar.

Below summaries the Budgets and Forecasted Financial Statements that need to be completed before you can develop your Second Year Forecasted Cash Flow Statement. Furthermore, in our example, Murray would have used the following Budgets and Forecasted Statements to develop his 200Y Forecasted Cash Flow Statement.

Budget Name Required to Determine Your Forecasted
Sales Budget Monthly Cash Paid to You by Customers
Cash Investment Budget Cash Invested by Owners throughout the year
Purchase Budget Monthly Payment on Purchases
Operating Expenses Budget Monthly Payment on Operating Expenses
Income Tax Rate & Budget Payment on Income Taxes
Withdrawal/Dividends Budget Payment for Drawings or Dividends
Fixed Asset Budget Payment for Fixed Asset Purchases
Interest Expense Budget Payment on Interest for Additional Financing
200X Forecasted Cash Flow Statement Ending Cash transition to Beginning Cash

 

ADDITIONAL EXAMPLES ON FORECASTED CASH FLOW STATEMENTS

J&B Incorporated
The Internet Company
The Maple Syrup Company

 

For further information, please refer the section entitled "The Cash Flow Statement"

Categories: Forecasting