7. Cash budget Aa Aa The cash budget is considered the primary forecasting tool when firms try to estimate their cash flows and figure out if they are likely to need additional cash flows or to generate surplus cash Consider the case of Mooney Equipment: Mooney Equipment is putting together its cash budget for the following year and has forecasted expected cash collections over the next five quarters (one year plus the first quarter of the next year). The cash collection estimates are based on sales projections and expected collection of receivables. The sales and cash collection estimates are shown in the following table (in millions of dollars): Q1 Q3 $1,320 $1,620 1,670 $1,470 $1,720 Q2 Q4 Sales Total cash collections $1,320 $1,370 $1,420 $1,420 You also have the following information about Mooney Equipment: Sess