Learning aim E:

Break-even and cash flow forecasts

Formulas used in this topic will not be given in external assessment

E1: Cash flow forecasts

• Prepare, complete, analyse, revise and evaluate cash flow.

• Opening and closing cash/bank balances.

• Use of cash flow forecasts for planning, monitoring, control and target setting.

• Problems within the cash flow forecast.

• Solutions to cash flow problems.

• Benefits and limitations of cash flow forecasts.

E2: Break-even analysis + Step by step video

• Costs to business

• Sales revenue generated by business 

• Break-even point

• Margin of safety

• Identification of area of profit and area of loss

• Contribution per unit benefits and limitations

• Use of break-even for planning, monitoring, control and target setting

• The advantages and disadvantages of break-even