Accounts and finance

Table of Contents

1. Topic pack - Accounts and finance - introduction
2. 3.1 Sources of finance - notes
3. 3.1 Sources of finance - questions
4. 3.2 Investment appraisal - notes
5. Investment appraisal
6. 3.2 Investment appraisal - questions
7. 3.3 Working capital - notes
   1. Working capital
   2. Working capital cycle
   3. Cash flow forecasts
   4. Profit and cash
   5. Cash flow forecasts
   6. An overtrading scenario
   7. Management of working capital
8. 3.3 Working capital - questions
9. 3.4 Budgeting - notes (HL only)
10. 3.4 Budgeting - questions
11. 3.5 Final accounts - notes
12. 3.5 Final accounts - questions
13. 3.5 Final accounts - simulations and activities
14. 3.6 Ratio analysis - notes
15. 3.6 Ratio analysis - questions
16. 3.6 Ratio analysis - simulations and activities
17. Printable version

3.3 Working capital - notes

In the previous section we looked at sources of finance and their suitability and used different methods of investment appraisal. We now move on to look at working capital and the preparation of cash flow forecasts.

By the end of this section you should be able to:

• Define working capital and explain the working capital cycle
• Prepare a cash-flow forecast from given information
• Evaluate strategies for dealing with liquidity problems