Cash Budget

The importance of bullion figure may be summarised as follow:-(1) Helpful in planning. Cash figure helps preparation for the most efficient use of bullion. It points out cash surplus, or deficiency at selected point of time and enables the management to rate for the deficiency before time or to plan for enthronization the surplus money as juicy as possible without any threat to the liquidity. (2) Forecasting the Future needs. Cash cypher forecasts the future needs of funds, its time and the amount well in advance. It, thus, helps planning for raising the funds through the most moneymaking sources at reasonable terms and costs. (3) Maintenance of Ample cash Balance. Cash is the bottom of liquidity of the enterprise. Cash work out helps in maintaining the liquidity. It suggests adequate cash balance for expected requirements and a circus margin for the contingencies. (4) Controlling Cash Expenditure. Cash reckon acts as a controlling device. The expenses of various departments in the firm can best be controlled so as not to spend the budgeted limit. (5) Evaluation of Performance. Cash budget acts as a amount for evaluating the financial performance. (6) Testing the Influence of proposed Expansion Programme. Cash budget forecasts the inflows from a proposed expansion or investment programme and charter its impact on cash position.

(7) Sound Dividend Policy. Cash budget plans for cash dividend to shareholders, consistent with the liquid position of the firm. It helps in pursuance a sound consistent dividend policy. (8) Basis of Long-term preparedness and Co-ordination. Cash budget helps in co-o rdinating the various finance functions, m! uch(prenominal) as sales, credit, investment, working capital etc. it is an important instauration of long term financial planning and helpful in the study of long term financing with respect to belike amount, timing, forms of security and methods of repayment. | The importance of cash budget may be summarised as follow:-(1) Helpful in Planning. Cash budget helps...If you want to get a full essay, order it on our website: BestEssayCheap.com

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