1.3.3 - Cash and Cash Flow Flashcards Preview

GCSE Edexcel - Business definations and equations > 1.3.3 - Cash and Cash Flow > Flashcards

Flashcards in 1.3.3 - Cash and Cash Flow Deck (12)
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1

Credit:

The amount of money that a financial institution or supplier will allow a business to use, which it must pay back in the future at an agreed time

2

Overheads:

Fixed costs that come from running and office. Shop or factory, which are not affected by the number of specific products or services that are sold

3

Insolvent:

Insolvent: A business that is unable to pay its debts and/ or owes more money than it is owed

4

Consumables:

Items that get 'used up', such as pens, paper, staples and other items that a business has to replace regularly

5

Equation Net cash flow

Net cash flow = Cash inflow - Cashg outflow

6

Cash flow forecasting

Refers to the prediction fo cash coming in and moving out of a business.

7

Equation Closing balance

Opening balance + net cash flow

8

Equation Opening Balance

Opening balance = Closing balance in preceeding month.

9

Cash inflow

-Refers to money coming into the business
- Eg Government grants, or sales.

10

Cash outflow

-Refers to the outgoings of the business,
- e.g. Payment of wages, rawmaterals and utility bills.

11

Solvent

A business is solvent when it has ufficient cash oto repay its bills.

12

Net cash flow

is the money available for the daily running of a business.