Prepare a cash flow forecast for the years

Assignment Help Financial Management

Reference no: EM131599531

Question.1 ( No excel calculations)

A finance manager from TLC is trying to prepare a cash flow forecast for the years 2014–2016. The estimated sales are:

Year 2013 2014 2015 2016 2017

Sales(R) 20mil 22mil 24mil 21mil 25mil

These sales will be made on three months’ credit and there will be no bad debts.

There are only three cost elements:

• First, wages amounting to R6 million per year

• Second, raw materials costing one- half of sales for the year. Raw material suppliers grant three months of credit

• Third, direct overhead (only incurred if the project is undertaken) at R5 million per year Start date: 01.01.2013.

Calculate the net operating cash flow for the years 2014–2016.

Reference no: EM131599531

Questions Cloud

Economy with regard to savings and investment : Which of the following is true for a closed economy with regard to savings and investment?

Similarities and differences between the two methods : The direct method and the indirect method. What are the similarities and differences between the two methods?

Bid-ask spread means that dealer will realize lower profit : A larger bid-ask spread means that the dealer will realize a lower profit. The efficient markets hypothesis assumes that all investors are rational.

Use the net present value method of project appraisal : Use the net present value method of project appraisal to advise the company on whether to go ahead with the proposed project.

Prepare a cash flow forecast for the years : A finance manager from TLC is trying to prepare a cash flow forecast for the years 2014–2016.

About a huge ipo being carried out by a leading technology : She has read a number of newspaper articles about a huge IPO being carried out by a leading technology company.

Commercial banks-investment banks and mutual funds : commercial banks, investment banks, mutual funds, hedge funds, and private equity companies.

Regarding the fisher effect : Explain the following questions regarding the Fisher Effect.

Financial markets experienced during the last two decades : What types of changes have financial markets experienced during the last two decades?

User Account

All Pages