Question

Select the incorrect statement regarding the cash budget. Multiple Choice Cash inflows and outflows indicated on the cash budget are reported on a company's pro forma statement of cash flows. Cash payments may include outflows for inventory, selling and administrative expenses, and equipment purchases. The cash budget helps managers to anticipate cash shortages and excess cash balances. The total cash available is calculated by adding cash receipts and the ending cash balance.

Answer 1

The incorrect statement regarding the cash budget is :

The total cash available is calculated by adding cash receipts and the ending cash balance.

Step-by-step explanation:

The Cash available is calculated by adding the Cash Receipts to the Opening Cash Balance instead of the Ending Cash Balance.

The Cash that is available would then be used to meet cash expenditures for the anticipated period.