Cash flow statement

Registered Posts: 34 ? ? ?
How do you approach the producing a cash flow statement (for 3 months) when information is limited.

You are given the opening (£4,000) and closing cash balances (£33,000).

However prior to the period £15,000 is owed by debtors and at the end of month 2 debtors now owe £40,000 however no indication is given of debtors terms.

Sales are £24,000 (month 1) £26,000 (month 2) and £27,000 (month 3)

In the notes it says capital payments have been made but no indication of the amount has been given.

• Registered Posts: 585
Miss Dazy wrote: »
How do you approach the producing a cash flow statement (for 3 months) when information is limited.

You are given the opening (£4,000) and closing cash balances (£33,000).

However prior to the period £15,000 is owed by debtors and at the end of month 2 debtors now owe £40,000 however no indication is given of debtors terms.

Sales are £24,000 (month 1) £26,000 (month 2) and £27,000 (month 3)

In the notes it says capital payments have been made but no indication of the amount has been given.

first workout the net cash inflow for the 3 months

o/debtors plus 3 months sales less c/debtors.

now you can work out the net cash out flow for the 3 months by:

o/bank bal plus 3 months net cash inflow less c/bank balance.

You won'tbe able to do a 3 individual cash flow statement but you can now produce a 3 month combined cash flow

opening bank bal
plus net cash inflow
less net cash outflow
equals c/bank balance
• Registered Posts: 34 ? ? ?
could you just clarify this:

now you can work out the net cash out flow for the 3 months by:

o/bank bal plus 3 months net cash inflow less c/bank balance.

as i am still not arriving at the £33,000 closing cash balance
• Registered Posts: 585
cash inflow = 4+24+26+27-33=48

cash outflow = 4+48-33=19

cash flow

o/bank bal.................................... 4
plus cash inflow ...........................48
less cash outflow ........................-19

equals closing bank balance
33