Complete and amend a simple cash-flow forecast
Fill missing forecast figures with net cash flow and balance arithmetic; candidates are not assessed on constructing forecasts.
Cambridge IGCSE Business 0264, 2027–2029 syllabus, Topic 5. Use the supplied data and show calculation steps. Candidates are not assessed on constructing cash-flow forecasts or financial statements. Written practice is self-checked and does not certify exam readiness
Before you begin
- No previous finance study is assumed. Identify the time period, whether a figure is a stock or a flow, and the units before calculating or recommending.
Work on paper. Try each question before revealing help, and explain why your method works.
Quick readiness check
Opening cash is $500 and net cash flow is −$80. What is closing cash?
What you will learn
- Calculate missing inflows, outflows or balances
- Carry balances between periods
- Show arithmetic clearly
Use the forecast relationships
Net cash flow = total cash inflows − total cash outflows. Closing balance = opening balance + net cash flow. These relationships let a learner amend or complete a simple forecast when one item is missing.
If an unknown cash outflow is missing, rearrange the relationship: outflows = inflows − net cash flow. Keep negative net flows signed and check that the closing figure follows from the opening figure.
Respect the assessment boundary
The 2027–2029 syllabus asks learners to amend or complete and interpret a simple cash-flow forecast. It states candidates will not be assessed on constructing a cash-flow forecast.
In a question, use the figures and layout provided, show the missing calculation and state any unit or period. Do not infer that a forecast's figures are certain or that cash received equals sales made in the same period.
Pause and explain
What does the syllabus say about constructing a cash-flow forecast?
Worked example
A forecast shows opening cash $1,200, inflows $5,400 and closing cash $900. Find total outflows.
Show the worked solution
- Net cash flow = closing minus opening = 900 − 1,200 = −300.
- Outflows = inflows − net cash flow.
- 5,400 − (−300) = 5,700.
Answer Total cash outflows are $5,700. Net cash flow is −$300 because closing cash is $300 below opening cash; therefore outflows exceed inflows by $300.
Try a topic test
Choose Easy, Normal or Difficult. Save your answers and open worked review after finishing.
Test this topic →From guided practice to a new situation
Write your answer and reasoning first. Use a hint only if you are stuck. The model solution is for self-checking; your written work is not automatically marked.
A forecast has opening balance $2,000, inflows $8,500 and outflows $7,900. Complete net cash flow and closing balance.
Give me a hint
Subtract outflows from inflows, then add the result to opening cash.
Compare my reasoning
- 8,500 − 7,900 = 600.
- Net cash flow is +$600.
- 2,000 + 600 = 2,600.
Net cash flow is +$600 and closing cash is $2,600. The period adds $600 to the opening balance.
Look for these in your work
- Net cash flow correct
- Closing balance correct
- Movement interpreted
A forecast's opening balance is $1,750 and closing balance is $1,100. Inflows are $6,200. Find net cash flow and total outflows.
Give me a hint
Find the balance change first, then rearrange net cash flow = inflows − outflows.
Compare my reasoning
- Net cash flow = 1,100 − 1,750 = −650.
- Outflows = inflows − net cash flow.
- 6,200 − (−650) = 6,850.
Net cash flow is −$650 and total outflows are $6,850. Outflows exceed inflows by $650, which explains why closing cash is below opening cash.
Look for these in your work
- Balance change correct
- Rearrangement correct
- Sign explained
A monthly forecast starts with $450, has outflows of $2,400 and ends at $300. Find inflows and explain one check on the estimate.
Give me a hint
Net cash flow is closing less opening; then add outflows to find inflows.
Compare my reasoning
- Net cash flow = 300 − 450 = −150.
- Inflows = net cash flow + outflows.
- −150 + 2,400 = 2,250.
Forecast inflows are $2,250. This produces net cash flow of −$150 and closing cash of $300. The business should check whether receipt dates and amounts are realistic, since delayed customers would change the estimate.
Look for these in your work
- Net movement correct
- Inflows calculated
- Assumption check included
Common mistakes
- Dropping the negative sign when closing cash falls
- Adding rather than subtracting when rearranging the equation
- Claiming the syllabus assesses full forecast construction
What can you explain now?
Opening cash is $500 and net cash flow is −$80. What is closing cash?
Compare with the explanation
$420
Add the signed net cash flow: 500 − 80.
After trying it yourself, choose your next review. This is your self-assessment.
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Make it stick
Which relationships let you complete a missing balance in a simple cash-flow forecast?
If you needed the solution, close it and solve the problem again from a blank page. A correct answer is stronger when you can explain the reason for each step.