Cash Flow and Financial Performance

Vocabulary flashcards for understanding cash flow and financial performance concepts.

Cash Flow

The movement of cash into and out of a business over a period of time.

Cash Flow Forecasts

Prepared in advance and usually over 3, 6, 9, or 12 months to help identify possible financial problems.

Cash Flow

The total cash payments (inflows) into a business minus the total cash payments (outflows).

Liquidation

Turning assets into cash.

Insolvent

When a business cannot meet its short-term debts.

Cash Inflows

Payments received by a business, such as from customers or a loan.

Cash Outflows

Payments made by a business, such as those to suppliers and workers.

Debtors

Customers who have bought products on credit and agreed to pay at a future date.

Credit Sales

Value of goods sold to customers who do not pay cash immediately.

Cash Flow Forecast

An estimate of a firm's future cash inflows and outflows.

Net Monthly Cash Flow

The estimated difference between monthly cash inflows and outflows.

Opening Balance

Cash held by the business at the start of the month.

Closing Balance

Cash held at the end of the month, which becomes the next month's opening balance.