What are the strengths and weaknesses of a cash budget?
A Cash Budget is perfect for individuals and for businesses as well. The Cash or Cash Flow Budget utilizes a spread sheet with columns and begins with a projection of incoming cash, usually on a monthly or weekly basis. Projected expenditures are then inserted into the spread sheet, based on the time frame in which they must be paid. A running balance is maintained to ensure that expenditures are not incurred unless cash will be available to pay them on a timely basis. This budgeting technique enables the user to manage money in a manner that will ensures that all bills can be paid promptly and so that plans can be made to accumulate a savings fund.
