Five steps to create a cash budget are determine a minimum cash balance.

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1. Establish a Minimum Cash Balance: Before creating a cash budget, it is essential to determine what the minimum amount of cash that needs to be maintained in the business’s bank account. This should include cash reserves for emergencies and other unexpected expenses.

2. Gather Essential Financial Information: The next step is gathering all of the financial information needed to create an accurate cash budget, such as current income statements, expense reports, balance sheets and bank statements. This information will help provide an accurate picture of how much money will be available each month and where it will need to be allocated.

3. Calculate Monthly Income Sources: After collecting the necessary financial information, calculate how much money will be coming in each month from sources like sales revenue and investments. This should include both regular monthly income sources as well as irregular influxes like one-time payments or large orders that come at certain times in the year.

4. Outline Expenses: Next, list out all expected expenses for the month based on past spending patterns and projections for future costs like salaries or new equipment purchases. Many businesses also set aside funds for marketing activities or employee bonuses throughout the year so these should also be accounted for when creating a budget plan every month..

5. Create Budget Forecast Model: Finally, use all of this data to create a spreadsheet model with projected income inflows compared against expected expenditures over time so that any potential shortfalls can easily be identified before they become a problem.. By estimating monthly capital flows from both internal sources (such as accounts receivables) and external ones (debtors), businesses can get an accurate picture of their total available liquidity position over time which helps them make informed decisions regarding future resources allocation.