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1. Prepare a Financial Plan based on the following information in the Appendix: Online Company best pet food wants to prepare its Financial plan for
1. Prepare a Financial Plan based on the following information in the Appendix: Online Company best pet food wants to prepare its Financial plan for the next 6 months in 2020. Revenues: based on last year estimation is for January to March, per month USD 15,000 and for Aprli June, per month USD 20,000. The company sells 50% via online payment tools and receives the money immediately on their account, while the other 50% are sold via invoices payments are expected in the following month. Cost of goods sold: 60 % of the revenues for each month - supplier insists on payments before delivery of the goods therefore payments are in the same month as the revenues occurs. All following costs are paid in the same months as it occurs: IT maintenance costs: monthly contract with USD 1,000 Company plans to invest in their IT infrastructure: in February with USD 2,000 and in May with another USD 3,000 Personnel costs per month: USD 1,500 Other costs per month: USD 500 The Company has USD 5,500 on the bank account as of 1. January 2020 Financial Plan "best pet food" Jan Feb Mar Apr May June TOTAL Cash inflows payments clients Total inflows Cash outflows Cost of good sold IT maintenance Invest Personell other costs Total outflows NET CASH FLOW Opening balance Closing balance 2. Please explain the calculation of the Cash cycle with its 3 elements and provide for each element an example, what a company could think about for its improvement
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