Respond to the following in a minimum of 175 words: Firms need to buy raw materials or inventory to turn them into finished goods for sale. When inventory is purchased and then sold as finished goods...

Firms need to buy raw materials or inventory to turn them into finished goods for sale. When inventory is purchased and then sold as finished goods on credit, it creates a cash cycle from the time the goods are purchased, then sold, and when the accounts receivable is collected as cash. Explain why an accurate and detailed operating cash budget is needed in financial forecasting for small business
A cash budget helps the business organization to get reflected the cash inflow and outflows and also assists in strategising the short term credit requirements. Therefore, financing for the businesses are achieved through the process of cash budgeting where budgets acts as a part of the strategies which is planned and controlled by the management of the organization in order to achieve the utilization of various resources efficiently and supporting other business activities (Dr. Marus Eton, Fabian Mwosi & Dr. Patrick Benard Ogwel, 2018). Even the failure of the organization has been attributed to certain factors like the lack of ample financial planning (Ojua, 2016; Ocansey...