3.

CASH FLOW STATEMENT – Is a vital planning tool in projecting the business cash requirements and
cash shortages. An Entrepreneur will be able to determine in advance how much cash is needed to start
and run the business until that point when cash receipts from sales and other income sources start
coming in, when will it be needed, and where will it come from.
Aside from using the Cash Flow Statement in projecting cash requirements, it can also be used as a tool
in monitoring and evaluating the actual inflow of cash (cash received from various sources such as initial
capital, loans, sales and other sources of income) and the outflow of cash (cash paid out for various
purposes such as raw materials, supplies, wages, rent, interest, etc) in the business.

CASH FLOW STATEMENT

CASH IN-FLOW YEAR 1 YEAR 2 YEAR 3

CASH BEGINNING BALANCE 332, 600 1, 969, 200

CASH EQUITY/CAPITAL 1, 000,000

CASH SALES 4, 968, 000 5, 961, 600 7, 153, 920

BORROWINGS

TOTAL CASH IN-FLOW 5, 968, 000 6, 294, 200 9, 123, 120

LESS: CASH OUT-FLOW

PRE-OPERATING EXPENSES 2, 000

MACHINERIES & EQUIPMENT 1, 804, 400

OPERATING EXPENSES 1, 345, 000 1, 345, 000 1, 345, 000

CGS 2, 484, 000 2, 980, 000 3, 576, 000

ENDING CASH BALANCE 332, 600 1, 969, 200 4, 202, 120