Final answer:
A document that forecasts cash flows of an income-producing property is known as a cash flow projection or forecast, which includes estimations of revenue and expenses to assess the property's profitability.
Step-by-step explanation:
A document that forecasts the cash flows of an income-producing property is commonly known as a cash flow projection or a cash flow forecast. This financial tool is vital for investors, finance professionals, and property managers who need to estimate the revenue and expenses related to a property over a certain period. A cash flow projection typically includes all cash inflows from rents or other income and subtracts all cash outflows such as operational expenses, mortgage payments, maintenance costs, and capital expenditures. This allows for the calculation of net cash flow, which is critical for assessing the profitability and financial health of the property.
With this document, individuals can make informed decisions regarding property investments, potential financing, and management strategies. It is important to create accurate and realistic projections to avoid financial shortfalls and to ensure a property remains a viable asset.