Cash Budget Worksheet Template

A Cash Budget is an itemized list of the potential sources of cash and its uses at a future time. A Cash Budget Worksheet can help a company in the future; prepare it for eventualities like shortage of cash or a surplus of it. A Cash Budget Worksheet can be created with the help of Cash Budget Worksheet guidelines.

The cash inflow and cash outflow of a business is predicted by a Cash Budget Worksheet. This can be done on a month to month basis or for a limited period of time like six months. Cash flow suffers seasonal fluctuations and benefit from suppliers giving quantity discounts quite unexpectedly. A Cash Budget Worksheet can help deal in both events. The cash position of a company is what makes the business viable. Therefore, a cash budget is very important.

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Three key elements of a cash budget are the time period, the cash position that is desirable, and an approximation of sales and expenses. First of all, choose the time period for which you want to create the cash budget. This is an important factor in creating a Cash Budget Worksheet. Next thing on a Cash Budget Worksheet is the cash position that you would like your company to be in, in the specified time period. The cash position that you want your company to be in will depend on various factors. Some of these are whether your account receivable is predictable or not and if there is a probability of occurrences that are fast happening, whether fortunate or unfortunate. Based on these factors, you can decide how much cash you want in hand. Having sufficient cash reserve by the end of the budgeting period will also depend on the amount of sales. An approximate value of the sales that will take place in the future is very important to a Cash Budget Worksheet. Without this figure a cash budget will not work.

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An increase or a decrease in sales will mean that you need to adjust the other components of your budget. Prices of raw materials, goods sold, and inventory must be changed and adjusted to reflect the change in sales. Every expense must be accounted for.

A Cash Budget Worksheet should begin with the cash balance at the time of creating the cash budget. This should be divided into income and expense that is cash outflow. Income includes account record collections, loan proceeds, and sales and receipts. Cash outflow or expenses include money spent on advertising, bank service charge, credit card debt, health insurance, insurance, inventory purchases, interest, payroll, payroll taxes, etc. Utilities and telephone bills also come into this category. Professional fees, rent or lease, supplies, and taxes and licenses also fall in this category.

After you have tabulated all this, put down the subtotal. If there are other sources of cash outflow, put those down; for example, capital purchases, loan principal, and owner’s draw. Calculate the subtotal. Calculate the total cash outflow. Then you have the ending cash balance.