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Preschool Cash Flow Budget

Satisfactory Essays

What we have-In the cash flow budget, we start with $100,000 at the beginning of the month each month. Our beginning revenue and income came from tuition and fees. The total cash payments from January through December was $100,000. In May and November our biggest income came in from tuition and fees, plus event income of $50,000, and from foundation support of $400,000. For the cash flow budget to stabilize each month over the annual budget year, we need to at least start off with $180,000 for the first four months, from about January to April. This is so that cash spending will remain steady for the remainder of the year. The idea of $180,000 during the first 4 months will hopefully lessen any cash flow and spending short shortfalls over the year, while adhering to the board of director’s goal of at least $80,000 at the end of each month.
As the budget stands right now, we are going to have a $100,000 deficit at the end of the year. This doesn’t leave much money for the safety margin or starting up the preschool program …show more content…

This way we are keeping any eye on or salary and wage expenses. A suggestion for increasing and stabilizing the preschool program budget could be to move the foundation support to the earlier part of the year. For example, the foundation supports could be in January and July instead of May and November, that way the biggest income happens at the beginning of the year and we could evaluate making any needed changes to the budget to avoid a monthly cash shortfall, cutting necessary expenses, and having to borrow money that the organization cannot pay back the next year. Another suggestion could be to request the foundation support for the year in one lump sum payment instead of receiving it in two payments. That way the organization would have the money upfront instead waiting to apply the fund in that future

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