1. What is included in liquidity?

2. Develop a cash budget based on the following information about a K-12 school. Its fiscal year runs from July 1 to June 30.

Cash inflow:

Federal sources: $300,000, paid in January

State sources: $300,000, paid bimonthly

Local sources: $200,000, paid semiannually in July and January

Cash outflow:Personnel services costs: $100,000

Contracted services: $10,000

School operations: $20,000

Facility operations & maintenance: $30,000

Assuming that the initial cash balance is $100,000 at the beginning of the school year and the cash safety margin is $10,000, what does the cash budget tell you? What do you do with this information?