Managing Cash Flow

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Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total Projected Income Statement Sales 1,600.0 1,616.0 1,632.2 1,648.5 1,665.0 1,681.6 1,698.4 1,715.4 1,732.6 1,749.9 1,767.4 1,785.1 20,292.0 Cost of goods sold - var 640.0 646.4 652.9 659.4 666.0 672.6 679.4 686.2 693.0 700.0 707.0 714.0 8,116.8 Cost of goods sold - fixed 425.0 435.0 445.0 455.0 465.0 475.0 485.0 495.0 505.0 515.0 525.0 535.0 5,760.0 Selling, g & a - var. 160.0 161.6 163.2 164.8 166.5 168.2 169.8 171.5 173.3 175.0 176.7 178.5 2,029.2 Selling, g & a - fixed 55.0 55.0 55.0 55.0 55.0 55.0 65.0 65.0 65.0 65.0 65.0 65.0 720.0 Interest ______ 10.3 ______ 11.1 _____ 13.3 _____ 11.5 _____ 12.7 _____ 11.1 _____ 11.2 _____ 9.7 ______ 8.6 _____ 9.1 ______ 8.4 ______ 8.3 _______ 125.4 Profit before taxes 309.7 306.9 302.8 302.7 299.8 299.8 288.0 288.0 287.6 285.8 285.3 284.2 3,540.6 Income taxes ______ 123.9 ______ 122.7 _____ 121.1 _____ 121.1 _____ 119.9 _____ 119.9 _____ 115.2 _____ 115.2 ______ 115.1 114.3 _____ ______ 114.1 ______ 113.7 _______ 1,416.3 Net Income ______ 185.8 ______ 184.1 _____ 181.7 _____ 181.6 _____ 179.9 _____ 179.9 _____ 172.8 _____ 172.8 ______ 172.6 171.5 _____ ______ 171.2 ______ 170.5 _______ 2,124.4 Net Income % of Sales 11.6% 11.4% 11.1% 11.0% 10.8% 10.7% 10.2% 10.1% 10.0% 9.8% 9.7% 9.6% 10.5% ______ ______ _____ _____ _____ _____ _____ _____ ______ _____ ______ ______ _______ Loan Amortization Principal - beginning bal. 1,346.1 1,330.6 1,315.1 1,299.4 1,283.6 1,267.7 1,251.7 1,235.5 1,219.3 1,202.9 1,186.4 1,169.8 Interest 9.5 9.4 9.3 9.2 9.1 9.0 8.9 8.8 8.6 8.5 8.4 8.3 107.0 Principal payment ______ 15.5 ______ 15.6 _____ 15.7 _____ 15.8 _____ 15.9 _____ 16.0 _____ 16.1 _____ 16.2 ______ 16.4 _____ 16.5 ______ 16.6 ______ 16.7 _______ 193.0 Principal - ending bal. 1,330.6 ______ 1,315.1 ______ 1,299.4 _____ 1,283.6 _____ 1,267.7 _____ 1,251.7 _____ 1,235.5 _____ 1,219.3 _____ 1,202.9 ______ 1,186.4 _____ 1,169.8 ______ 1,153.1 ______ _______ 1,153.1 Interest on line of credit ______ 0.8 ______ 1.7 _____ 4.0 _____ 2.3 _____ 3.6 _____ 2.1 _____ 2.4 _____ 0.9 ______ 0.0 _____ 0.6 ______ 0.0 ______ 0.0 _______ 18.4 Exhibit A.5 Jack B. Nimble Company Cash Flow Projection For 20x3
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total Cash Flow A/R coll. - current month 160.0 161.6 163.2 164.8 166.5 168.2 169.8 171.5 173.3 175.0 176.7 178.5 2,029.2 A/R coll. - prior month 869.0 880.0 888.8 897.7 906.7 915.7 924.9 934.1 943.5 952.9 962.4 972.1 11,047.8 A/R coll. - 2d prior mo. ______ 538.2 ______ 545.1 _____ 552.0 _____ 557.5 _____ 563.1 _____ 568.7 _____ 574.4 _____ 580.2 ______ 586.0 591.8 _____ ______ 597.7 ______ 603.7 _______ 6,858.4 Total Receipts 1,567.2 1,586.7 1,604.0 1,620.1 1,636.3 1,652.6 1,669.1 1,685.8 1,702.7 1,719.7 1,736.9 1,754.3 19,935.5 Cost of goods sold 937.5 950.9 964.4 977.9 991.5 1,005.1 1,018.9 1,032.7 1,046.5 1,060.5 1,074.5 1,088.5 12,148.8 Selling, gen. & admin. 210.0 211.6 213.2 214.8 216.5 218.2 229.8 231.5 233.3 235.0 236.7 238.5 2,689.2 Interest 10.3 11.1 13.3 11.5 12.7 11.1 11.2 9.7 8.6 9.1 8.4 8.3 125.4 Taxes 396.0 367.7 241.0 350.3 1,355.0 Other - capital investment 125.0 700.0 175.0 200.0 200.0 200.0 200.0 200.0 200.0 200.0 200.0 200.0 2,800.0 Debt principal ______ 15.5 ______ 15.6 _____ 15.7 _____ 15.8 _____ 15.9 _____ 16.0 _____ 16.1 _____ 16.2 ______ 16.4 _____ 16.5 ______ 16.6 ______ 16.7 _______ 193.0 Total Disbursements 1,694.3 1,889.2 1,381.6 1,787.8 1,436.6 1,691.4 1,476.1 1,490.1 1,855.1 1,521.0 1,536.2 1,552.0 19,311.4 Net Cash Flow -127.1 -302.5 222.5 -167.7 199.7 -38.8 193.1 195.7 -152.4 198.7 200.7 202.3 624.1 Beginning cash ______ -91.7 ______ -218.8 -521.3 _____ -298.9 _____ _____ -466.6 -266.9 _____ -305.7 _____ -112.6 _____ ______ 83.1 _____ -69.3 ______ 129.4 ______ 330.1 _______ -91.7 Available cash -218.8 -521.3 -298.9 -466.6 -266.9 -305.7 -112.6 83.1 -69.3 129.4 330.1 532.4 532.4 Line of credit borrowing ______ 228.8 ______ 531.3 _____ 308.9 _____ 476.6 _____ 276.9 _____ 315.7 _____ 122.6 _____ 0.0 ______ 79.3 _____ 0.0 ______ 0.0 ______ 0.0 _______ 0.0 Ending Cash 10.0 10.0 10.0 10.0 10.0 10.0 10.0 83.1 10.0 129.4 330.1 532.4 532.4 Exhibit A.5 Jack B. Nimble Company Cash Flow Projection For 20x3 (continued)
Page 2 and 3:
Managing Cash Flow An Operational F
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Contents About the Authors Acknowle
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ABOUT THE AUTHORS Rob Reider, CPA,
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About the Authors vii • Cash Flow
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INTRODUCTION CASH IS KING! Cash ava
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Why the Business Exists 3 • Custo
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Some Basic Business Principles 5
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Purpose of this Book 7 • Are sale
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CHAPTER 1 Understanding Cash Manage
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Understanding Cash Management 11 qu
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Cash Flow Basics 13 minimizing the
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Cash Flow Basics 15 FROM CASH TO CA
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Cash Flow Basics 17 • There needs
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Cash Flow Basics 19 The main reason
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History, the Fed, and Float 21 HIST
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History, the Fed, and Float 23 •
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History, the Fed, and Float 25 vers
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History, the Fed, and Float 27 Rece
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Bank Issues and Concerns 29 • Che
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Bank Issues and Concerns 31 or neve
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Conclusion 33 affects its relations
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CHAPTER 2 Managing Cash Flow—Rece
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Using the Balance Sheet 37 Change 2
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Cash Receipts 39 which could be use
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Cash Receipts 41 Sales per Day Avg.
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Cash Receipts 43 happening—would
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Cash Receipts 45 Invoicing The star
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Cash Receipts 47 earmark those for
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Cash Receipts 49 We can adjust the
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Cash Receipts 51 Finance Charges CA
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Cash Receipts 53 Standard sized env
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Cash Receipts 55 PAC Issuing Instit
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Cash Receipts 57 duction of about $
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Cash Disbursements 59 Sequence of A
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Cash Disbursements 61 determine whe
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Cash Disbursements 63 this system t
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Cash Disbursements 65 Estimated Fun
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Conclusion 67 Local Office #1 Sales
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CHAPTER 3 Planning and Budgeting PL
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Relationship Between Planning and B
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Relationship Between Planning and B
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Strategies for Competitive Advantag
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Strategic Planning Process 77 EXTER
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Strategic Planning Process 79 Once
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Short-Term Planning 81 D. PLANNING
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Short-Term Planning 83 TOP MANAGEME
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Short-Term Planning 85 Segment miss
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Short-Term Planning 87 Planning mis
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Short-Term Planning 89 limited in n
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Short-Term Planning 91 achievements
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Short-Term Planning 93 Credit/Colle
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CHAPTER 4 Analyzing the Sales Funct
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Purpose of the Sales Function 97 a
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Purpose of the Sales Function 99 1.
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Purpose of the Sales Function 101 L
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Purpose of the Sales Function 103 b
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Purpose of the Sales Function 105
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Purpose of the Sales Function 107 b
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Purpose of the Sales Function 111 S
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Purpose of the Sales Function 113 1
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Purpose of the Sales Function 115 t
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Purpose of the Sales Function 117 1
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Purpose of the Sales Function 119 r
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CHAPTER 5 Cost Reduction Analysis P
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Benchmarking Strategies 125 BENCHMA
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Benchmarking Strategies 127 determi
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Benchmarking Strategies 129 The ben
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Benchmarking Strategies 131 Product
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Benchmarking Strategies 133 Sales F
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Benchmarking Strategies 135 so that
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Benchmarking Strategies 137 To this
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Benchmarking Strategies 139 • Wha
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Benchmarking Strategies 141 increas
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Benchmarking Strategies 143 no ince
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Benchmarking Strategies 145 to eval
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Benchmarking Strategies 147 Accordi
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Benchmarking Strategies 149 Number
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Benchmarking Strategies 151 • Pur
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Activity Based Costing Principles 1
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Conclusion 175 the costs to particu
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Looking at the Accounting Function
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Choosing What to Analyze 179 expert
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Choosing What to Analyze 181 1. Def
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Identifying Goals and Basic Busines
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Financial Reporting 185 2. Accounts
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Financial Reporting 187 ASSETS Cash
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Compiling the Data 189 1. Organizat
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Compiling the Data 191 h. What is y
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Analyzing the Data 193 1. Organizat
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Analyzing the Data 195 e. Do you au
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Analyzing the Data 197 c. Can you p
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Organizational Issues 199 Controlle
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Budget Analysis 201 Budget Actual C
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Analysis of Functional Costs 203
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Analysis of Functional Costs 205 La
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Analysis of Accounting Operations 2
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Analysis of Accounting Operations 2
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Activity-Based Costing Applications
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Developing Recommendations 213 •
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Specific Recommendations 215 7. Per
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Specific Recommendations 217 ager a
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Specific Recommendations 219 figure
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Specific Recommendations 221 • Gr
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Specific Recommendations 223 • Sa
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Specific Recommendations 225 Curren
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Specific Recommendations 229 Based
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Organization Recommendations 233
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Other Areas for Review 235 • The
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Conclusion 237 must change its beli
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CHAPTER 7 Investing, Financing, and
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Investing Excess Cash 241 puts upwa
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Investing Excess Cash 243 Instrumen
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Investing Excess Cash 245 • Depre
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Investing Excess Cash 247 Cash Outf
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Investing Excess Cash 249 Investmen
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Borrowing for Cash Shortfalls 251 t
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Borrowing for Cash Shortfalls 253 m
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Borrowing for Cash Shortfalls 255 t
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Borrowing for Cash Shortfalls 257 r
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Borrowing for Cash Shortfalls 259 I
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Borrowing for Cash Shortfalls 261 A
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CHAPTER 8 Planning Cash Flow MANAGI
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Cash Flow Planning 265 or more futu
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Cash Flow Planning 267 Cash Budgeti
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Cash Flow Planning 269 ACTUAL PROJE
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Cash Flow Planning 275 THE MORE VOL
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Managing Cash Balances 277 on its u
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Cash Planning Approaches 279 Dealin
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Cash Planning Approaches 281 Cash f
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Conclusion 283 Cash flows from oper
Page 294 and 295: CHAPTER 9 Controlling and Analyzing
Page 296 and 297: Cash Flow Projections: Methodology
Page 302 and 303: Cash Flow Reporting and Controls 29
Page 310 and 311: Interpretation and Analysis of Cash
Page 332 and 333: AFTERWORD The materials in this boo
Page 334 and 335: APPENDIX A Case Study: Managing Cas
Page 336 and 337: Jack B. Nimble Company 327 ($$ in 0
Page 338 and 339: Jack B. Nimble Company 329 ABC Mach
Page 340 and 341: Jan Feb Mar Apr May Jun Jul Aug Sep
Page 342 and 343: Cash Forecast Information 333 him,
Page 346 and 347: Jack B. Nimble Company Suggested So
Page 348 and 349: Jack B. Nimble Company Suggested So
Page 350 and 351: APPENDIX B Cash Conservation Checkl
Page 352 and 353: Liabilities and Equity 343 ASSETS Y
Page 354 and 355: Income and Expenses 345 INCOME AND
Page 356 and 357: Index A ABC, see Activity based cos
Page 358 and 359: Index 349 traditional, 159-161 unit
Page 360 and 361: Index 351 P Payables, 16, 59 Paymen
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Managing Cash Flow

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