A cash flow forecast predicts the movement of cash into and out of a business over a specific period.

A cash flow forecast is the same as a profit and loss statement.

Cash inflows include cash received from sales, collections from accounts receivable, and other sources of income.

A cash flow forecast is only useful for large businesses.

Depreciation expense is a cash outflow.

A cash flow forecast can help a business identify potential cash shortages.

The most liquid asset of a business is cash.

Net cash flow is calculated by subtracting cash outflows from cash inflows.

The period of time between the point cash being spent on the production of a product and the collection of cash from a customer is called the cash conversion cycle.

A shorter cash operating cycle is generally preferable, as it indicates more efficient use of working capital.

The cash operating cycle is calculated by adding the inventory conversion period and the receivables collection period, and then subtracting the payables deferral period.

A company's cash operating cycle is unaffected by its accounts receivable collection terms.

A cash flow forecast helps in making decisions about investments.

A cash flow forecast should be regularly reviewed and updated to reflect actual results and any changes in the business environment.

Cash outflows include payments for expenses, purchases of assets, and other cash disbursements.

Insolvency occurs when a business has a negative cash flow but may actually be profitable.

A cash flow forecast is a static document and does not need to be updated.

A cash flow forecast is the same as a profit and loss statement.

A company's cash operating cycle is unaffected by its accounts receivable collection terms.

The cash conversion cycle is the same as the cash operating cycle.