Business 9609 · AS & A Level
Forecasting and managing cash flows
100 practice questions on Forecasting and managing cash flows, with worked solutions and instant marking.
Analyse why it is important for businesses to manage their cash levels effectively.
March 2016
With reference to Table 2 and any other relevant information, advise which location Sara ought to select for the new shop. Support your decision with reasons.
March 2016
Define the term ‘working capital’ in your own words.
March 2017
Analyse how a business might use break-even analysis when planning to launch a new product.
March 2018
Refer to Table 1. Calculate the value of X.
March 2018
Explain two methods that PC may use to improve its cash flow.
March 2018
Analyse one advantage and one disadvantage to PC of buying the computerised inventory management system.
March 2018
Analyse the advantages for a new business of preparing a cash flow forecast.
March 2019
Explain one reason why JF may want a high gross profit margin.
March 2019
Recommend which option Jim ought to choose by using the case-study information. Justify your view.
March 2019
Recommend which location SSR should choose for its second restaurant. Justify your recommendation.
March 2019
Explain how improved management of trade receivables and trade payables can strengthen cash flow.
March 2020
Use Table 1.1 together with any other relevant information. Recommend which of the two options Bob should choose. Justify your recommendation.
March 2020
Explain the effects on a business of having a high level of working capital.
March 2021
Recommend the source of finance FB should select to fund the change in production method. Justify your recommendation.
March 2021
Explain one method Rehana could adopt to improve liquidity.
March 2022
Analyse two ways in which accurate cost information may be used to raise business performance.
March 2023
Define what is meant by the term 'entrepreneur'.
Summer 2016
Analyse why it is important for a business to tell apart revenue expenditure and capital expenditure.
Summer 2016
Briefly explain one probable effect on PM of this reduction in total revenue.
Summer 2016
From Table 2, calculate the value of X.
Summer 2016
Explain the distinction between profit and cash for SS.
Summer 2016
Discuss the extent to which producing the cash flow forecast in Table 2 is useful for Steve.
Summer 2016
Define the term 'debt factoring'.
Summer 2017
Analyse the problems that a business could face in its first year of trading.
Summer 2017
Explain one method MM could use to improve its liquidity.
Summer 2017
Analyse why accurate cost data matters to all businesses.
Summer 2018
Define the term ‘capital expenditure’ in relation to fixed or non-current assets.
Summer 2018
Define the term ‘cash flow’ from line 10.
Summer 2018
Explain two ways in which VC could raise its working capital.
Summer 2018
Explain how Jacqueline could use the result from 2(b)(i).
Summer 2018
Analyse two methods Jacqueline could use to strengthen PP’s cash flow.
Summer 2018
Using Table 1.1, Calculate the new closing balance for Month 3 if each month's inventory storage costs increase by 20%.
Summer 2019
Define the term 'cash flow' in line 21.
Summer 2019
Using Table 1.1, Calculate the value of X in quarter 4.
Summer 2019
Explain two advantages to FN of cash flow forecasting.
Summer 2019
Define what is meant by the term ‘opportunity cost’.
Summer 2020
Analyse the advantages for a new business of using break-even analysis.
Summer 2020
Analyse the drawbacks to a business of using debt factoring to improve its cash flow.
Summer 2020
'An accurate cash flow forecast is the key financial document for a clothing retailer preparing to enter a new market.' Discuss the extent to which you agree with this view.
Summer 2021
Explain the importance of working capital for a new business.
Summer 2021
Analyse how accurate cost information benefits a business.
Summer 2021
Refer to Table 1.1. Calculate Ray’s projected average daily revenue if he joins Summus.
Summer 2021
Use Table 2.2 and any other relevant information. Advise which location LO ought to select. Support your advice with reasons.
Summer 2021
Analyse one benefit and one drawback to AF of leasing the new machinery for apple juice production.
Summer 2021
Explain the difference between cash and profit (line 23).
Summer 2022
Using Table 1.1, Calculate PB’s forecast closing balance for month 3 (X).
Summer 2022
Analyse two benefits to Priya of producing a cash flow forecast.
Summer 2022
Analyse two advantages to MC of Just in Time (JIT) inventory control.
Summer 2022
Analyse one advantage and one disadvantage to Su of using working capital as a source of finance for the new café.
Summer 2022
Analyse two benefits to a business of government grants as a source of finance.
Summer 2023
Analyse two purposes of a cash flow forecast for a business.
Summer 2023
Refer to Table 1.1. Calculate the forecast closing balance for August 2023.
Summer 2023
Explain one factor that will affect Markus’ choice of a source of finance.
Summer 2023
Evaluate whether Markus needs accurate cost information before setting up OFD.
Summer 2023
Using Table 2.1, Calculate GD’s forecast closing balance in 2025.
Summer 2023
Analyse two factors that may affect a business’s choice of sources of finance.
Summer 2024
Analyse two limitations that contribution costing may create for a business.
Summer 2024
Define what is meant by direct cost.
Summer 2024
Explain one cost for SW of retaining inventory.
Summer 2024
Analyse two drawbacks to CS of using a JIT approach to inventory management.
Summer 2024
Analyse one way a business might fail as a consequence of lack of finance.
Summer 2025
Analyse two benefits to a business of using break-even analysis.
Summer 2025
Analyse one advantage and one disadvantage to PH of using an overdraft as a source of finance.
Summer 2025
Use Fig. 2.1 together with the other information provided. Calculate the total payment to the social media influencer in February.
Summer 2025
Explain what the term working capital means.
Summer 2025
Define what is meant by the term ‘working capital’.
Winter 2016
Explain why many new businesses fail within their first year.
Winter 2016
Use Table 1. Calculate the value of X.
Winter 2016
Use Table 2 to calculate the value of Z.
Winter 2016
Discuss how FFE could improve its forecast cash flow.
Winter 2016
Use Fig. 1 together with the information in lines 10–11. Calculate the forecast revenue for Year 6.
Winter 2016
Using Table 2, calculate the value of X.
Winter 2016
Discuss the view that, for senior managers of a new international airport, cash flow forecasts may have only limited value.
Winter 2017
Use Table 1 together with any other relevant information. Work out the projected closing balance at the end of Month 2.
Winter 2017
Explain one benefit to Palesh of preparing a cash flow forecast.
Winter 2017
Analyse two methods Nathan could use to improve NN’s cash flow.
Winter 2017
Analyse the advantages and disadvantages for a new business of using an overdraft to help manage its cash flow.
Winter 2018
Define the term 'debt factoring'.
Winter 2018
Define what is meant by the term ‘cash flow forecast’.
Winter 2019
Analyse the advantages for an entrepreneur of buying a franchise when launching a business.
Winter 2019
Explain two possible disadvantages to FF of decreasing working capital.
Winter 2019
Analyse how cost information can be used to track performance and make a business perform better.
Winter 2020
Look at Table 2.1. Calculate the value of X.
Winter 2020
Explain one reason why EC’s liquidity is predicted to change.
Winter 2020
Explain how ‘cash’ (line 15) differs from ‘profit’ (line 15).
Winter 2020
Define what is meant by ‘overdraft’.
Winter 2021
Analyse the benefits to a business of debt factoring.
Winter 2021
Analyse two disadvantages to QF of holding a high level of inventory.
Winter 2021
From Table 2.1, work out the opening balance (X) for 2022.
Winter 2021
Using the figures in Table 2.1, calculate the sales value (Y) for 2026.
Winter 2021
Explain one use of the cash flow forecast for TM.
Winter 2021
Recommend whether Obi should buy Van A or Van B, and justify the choice you make.
Winter 2021
Analyse the advantages to a business of using a cash-flow forecast.
Winter 2022
Explain how a business might improve its cash flow.
Winter 2022
Explain one method MW could use to improve its cash flow.
Winter 2022
Analyse two advantages to MW of introducing process innovation to refresh its information systems.
Winter 2022
Define what is meant by business enterprise.
Winter 2023
Use Table 1.1. Calculate the forecast closing balance for March 2024.
Winter 2023
Use Table 2.1 and the other information provided. Calculate the forecast total revenue of product C in 2024.
Winter 2024