MasterPlans is a 14-year-old business plan writing company located in Portland, Oregon. To contact us, call 1-877-453-2011 or email info@masterplans.com.
button preload
button preload

MasterPlans: The business plan experts. Custom business plans by professional business plan writers. Business plan consulting by professional business plan consultants.

Cash Flow

Cash flow follows two basic logical steps—cash flows in, cash flows out. We recently needed to explain this to a business plan client in Atlanta.

Cash flows in from a few different sources. Generally it comes in the way of income from sales and services. In this case, the cash flow lines should be tied directly to the sales forecast of your business plan. Depending on whether you sell any of your goods on credit helps determine whether or not cash hits the cash flow statement now or later. If you take payments, then the receivables hit the balance sheet and the cash when the payment is made. Other things that flow in through cash flow are investing activities and loans. In investing activities, the company may take on a new investor or partnership. When that person pays in, it generally hits the cash flow table as well as balance sheet paid in capital. When a new loan is taken, the cash hits the cash flow table and the debt hits the balance sheet as a new long term liability.

Also, cash flows out through the payment of bills and expenses, as well as when purchasing inventory. This is where inventory turn days become important. If you buy a widget on the first but don't sell it until the 15th, and then you sell it on credit, it's possible that you won't recoup the cash for this outlay for more than 30 days. This is where it's important to have adequate cash balances to support your inventory turn and accounts receivable. Cash also goes out in the form of principle payments back to the loans the business has. Only the principle is on the cash flow statement, the rest of the payment is reflected in the accounts payable as interest expenses carried over from the profit and loss. Last, dividend payment to investors can also be reflected here on the cash flow.

Have questions? Please contact us for help structuring a proper cash flow statement for a business plan written in Atlanta or anywhere.

Need more answers?

Fill out the form below and a plan advisor will respond shortly.

Yes, I'm human and want to be contacted.
button preload
button preload
button preload

Work Her Way by Carolyn Kepcher Carolyn Kepcher of The Apprentice fame has used MasterPlans on two occasions.

Skout Natural by Jason and Denny Pastega Skout Natural received a $200,000 bank loan. Trailbars are flying off the shelf.

Senior Homestyle Living© by Ron Cheney Raised $20MM-$250MM in capital for a replicable elder care development in Texas.

Conductor by Seth Besmertnik and Jeremy Duboys Conductor received $2,600,000 in Venture Capital and expanded to 70 people.

BitCoinBitCoinBusinessWeekBusinessWeekEO PortlandEO PortlandPortland Business JournalPortland Business JournalEB5 VisaEB5 VisaInc. 500Inc. 500EntrepreneurEntrepreneurWall Street JournalWall Street JournalTop Ten ReviewsTop Ten ReviewsAuthorize.netMasterPlans Facebook pageMasterPlans Facebook page
© 2000–2017
0