Budgeting for cash Which of the following statements are true with regard to a cash budget? Check all that apply.

a. Cash budgets can be used to plan, coordinate, and control a firm’s activities.
b. A cash budget provides information about a company’s ability to repay its loans or meet its other obligations.
c. Annual budgeting information usually provides sufficient information to manage most companies.
d. A cash budget is a forecasted statement that shows how a company’s cash will be obtained and how it will be spent.

d. A cash budget is a forecasted statement that shows how a company's cash will be obtained and how it will be spent

Explanation:

A budget is a blueprint or a forecast which projects estimated future costs, revenues, income or other data. Actual information is later compared with budgeted information to ascertain the deviations and their causes and form conclusions.

A cash budget is a projected forecast of a company's cash inflows and outflows in future. A cash budget is a representation of budgeted future cash receipts and payments to determine the excess or deficit.

In case of deficit, it implies requirement of funds in future. The budget is also used to determine the sources from where the enterprise plans to raise such funds.

in 2001, dell computer became the world’s largest personal computer vendor, continuing to

gain market share and post profits in an industry struggling with slumping sales and billions of

dollars in losses. dell sells 90% of its pcs directly to the final customer, largely bypassing the

reseller channel that accounts for most of the world’s pc sales. this direct customer relationship

is the key to dell’s business model, and provides distinct advantages over the indirect sales

model. dell’s direct relationship with the customer allows it to tailor its offerings to customer

needs, offer add-on products and services, and use the internet to offer a variety of customer

services. in addition, dell’s pcs are built to customers’ specifications upon receipt of an order,

giving dell additional advantages over indirect pc vendors who must try to forecast demand and

ship products based on those forecasts. dell’s direct sales and build-to-order model has achieved

superior performance in the pc industry in terms of inventory turnover, reduced overhead, cash

conversion, and return on investment (kraemer, et al., 2000).

explanation: