The Statement of Cash Flows for a Private Not-For-Profit Organization

question 123

True/False

The Statement of Cash Flows for a private not-for-profit organization has three different classifications of cash flows.

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Definitions:

Cash Flow Forecasts

Estimates of the amount of money expected to flow in and out of a business over a specific period, used for budgeting and financial planning purposes.

NPV

Net Present Value is the difference between the current value of cash inflows and the current value of cash outflows over a period of time, used in capital budgeting to assess the profitability of an investment.

Simulation Analysis

A combination of scenario and sensitivity analyses.

Capital Budgeting

The process by which investors and managers decide which long-term projects or investments a business should undertake, based on potential profitability.