Cash

Money going in and out of a business is known as:

• A mortgage

• Break-even

• Cash flow

• Profit and loss

A cash flow is useful for

• Informing the business about its profits

• Helping the business see where cash shortages may occur

• Seeing the flow of cash from the business to the bank

• Choosing the best method of finance to expand the business

A cash flow shortage in a business is often solved by arranging

• An overdraft

• A loan

• Crowdfunding

• Selling shares

What is the net cash flow?

• -£16,000

• -£7,000

• £12,000

• £26,000

Which 2 are examples of cash inflows

• Bank loans

• Raw materials

• Receipts

• Suppliers

• Wages

Which 2 of the following could lead to improved cash flow?

• Complete market research

• Improve sales

• Negotiate lower prices with suppliers

• Employ extra staff

Which of the following best describes negative cash flow?

• Cash inflow exceeds cash outflow

• Revenue is greater than costs

• Cash outflow exceeds cash inflow

• Costs are greater then revenue

Which of the following is not a cash inflow?

• Purchasing goods and materials for cash

• Borrowing money from a bank

• Payment made by a debtor

• Sale of goods for cash

Which of the following is not a cash outflow?

• Sale of assets of the business

• Repaying loans

• Payment of wages and salaries

• Purchasing fixed assets

A profitable business can still run out of cash which can put it out of business.

• True

• False