eT lee eee 12 “Terrace Review — Wednesday, May 25, 1988 Cash management can head off problems It is not uncommon for a business to make a profit and yet be in some trouble because it doesn’t have the ready cash to pay its current bills. The answer to this seeming paradox is good cash management, the purpose of which is to ensure there is enough money on hand to meet expenses and bills when _ / —_ they come due. ; by Phil Harti It is true that keeping too much cash Manager, Terrace on hand means that the resources of the Federal Business business will not be used as profitably as Development Bank possible since surplus cash in the till is | doing nothing but sitting there. _ But it also is true that cash for a business operation is like many other things: It’s better to have too much than too little. However, it is better still to have the right amount, and the pur- pose of cash management is to determine as accurately as possi- ble just what that right amount is. There are a number of ways in which cash coming into a business can be controlled. @ Cash register and tape balances should correspond. Cheques received should be deposited in the bank as soon as possible. @ Care should be taken that the amount set as a petty cash reserve should always be there in either cash or vouchers. @ The records of the business and the bank records of deposits and withdrawals could correspond, with provision made for cheques which have been issued but have not reached the bank. Beyond these basic cheques and balances, however, a cash flow forecast should be prepared to obtain a reasonably good idea of what the cash needs will be, when they will arise, and where the money will come from to fill them. A cash flow forecast is not an operating forecast (projected profit and loss). A cash flow forecast shows all cash receipts from every source as they are received and all cash payments by . the business as they are made. An operating forecast shows sales - and expenses as they occur but sometimes before cash actually has been received or paid out. But it does not show changes in the cash position of the business and it does not necessarily show all cash transactions. A cash flow forecast usually is prepared for a year on a monthly basis, although it can be revised if required by developments. It will show expected revenues; when products are sold if the business is a seasonal one; what proportion of sales are for cash; what proportion of sales are on credit, with terms, proportion of customers who meet their obligations and propor- tion of receivables which might be delayed or never collected; and when raw materials must be purchased and terms of suppliers. A cash flow forecast may show that at certain times the business will not have sufficient cash on hand to meet its bills. In that case, arrangements should be made in advance with the business’ bank to ensure adequate cash is available when needed. No matter how long it takes to prepare, a cash flow forecast can be most helpful in planning for the future of any business. Cash is a vital asset of any business — and, like any asset, it must be managed. ; Okanagan firm gets | local gravel job | "TERRACE BUSINESS GUIDE_ ORGANIC _ T CUSTOM CABINETS — SASKATCHEWAN AND FURNITURE High quality — Low price . Free Estimates Installation and delivary included . . ”. Fairhaven Cabinet Shop 849-5673 Top Quality, Cleaned & Bagged Fairhaven Bakery Kitwanga, B.C. $49.5679 {also avallable at Dynamic Health Service) ‘i WestCoast | x Chimney Service WA Clean Chimney Maintenance Dealer for: . FINGARD CHIMNEY FIRE EXTINGUISHERS 635-9557 Pro TECH ELECTRONICS 4519 LAKELSE AVE., TERRACE 635-5134 - Complete electronics repalr services Service centre for most _ major brands. Satelite TV systems Kitwanga, 8.C. Dediccted People, Understanding a Need Directors — Alf & Jeanette DeFrane . &€727 Park Avenue, Terrace, B.C. 24-hour call — 638-8319 nN Pamphlets available for Memorlal Markers and Bronze Plaques “KALUM ELECTRIC Major Appliances: Frigidaire Electrohome Westinghouse. Quasar T.V. Sales & Service VCR Parts Depot We service - forali makes ail makes _ Kalum Electric Ltd. =“ Seez8s | CONTRACTING Rasidential — Commercial . Your complete source for all your heating TN Baie needs. we yurcoreal™ . plurvhdek": duradek. -_ Northwest Consolidated “Waterproof Vinyl Floor Covering" “ Suppy Ltd. 5239 Keith Ave., Terrace 635-7158 4.3916 MOUNTAINVIEW AVE. 635-5859 TERRACE, B.C. — gpectallzing In “+ 4x4 and Automatic Transmission | BUSINESS SERVICES t TYPING x VOICE PAGERS * PHOTOCOPYING te 24HOUR ANSWERING SEAVICE 638-8195 #1-3238 Kalum St., Terrace, B.C. VBG 2N4 Repairs Ltd fcc ‘Inflatable Boat Repairs #2. _24 HOUR SEAVICE HI-QUALITY BELTING & CONTRACTING SERVICES 638-8530 638-0663 Industrlal 638-1876 Commercial & ™~ ‘ Residential Wiring | Nate’s Electric Nathan Waddell —— Electrical Contractor 4631 Lazelle Ave., Terrace ICBC claims handled promptly 638-1166 MERC CRUISERS x MARINER OUTBOARDS HAMILTON & OUTBOARD MARINER JETS HOMELIGHT LAWNMOWERS YAMAHA 3 & 4 WHEELERS YAMAHA POWER PRODUCTS SHINDAIWA CHAIN SAWS _ DL No. 7850 & POWER PRODUCTS -KEN’S MARINE | NET at ati iti 4946 Greig Ave. Phone: 636-2909 ~~ The Alfred Funeral Home Ltd & can cee ne re toe TERRACE LTD. «2 Durable — High Quality % PY Vulcanizing Repairs # % 4711-A Kelth Ave. of” We specialize in Conveyer Belt "4%, %. = Installations, Splicing, and Repairs. “® "4 Auto Glass Specialists Vulcanizing and Pulley Lagging. 9 A $72,900 contract tender has been awarded to Inland Con- tracting Ltd., of Penticton, to crush and stockpile gravel in the | Terrace Highways District, the Ministry of Transportation and Highways announced last week. The project includes crushing, screening and stockpiling 5,000 cubic metres of winter sand and 3,000 cubic metres of high fines surfacing. at Robinson Lake Trail Pit, located approximately three kilometres south of the junction of Highway 37 and Kitimaat Village Road. The job “ also includes crushing, screening and stockpiling 7,500 cubic metres of winter sand at Hays’ Pit, located 47 kilometres west of Terrace on Highway 16. Material will be stockpiled at these locations, except for 2,000. cubic metres of winter abrasive at Robinson Lake Trail to be hauled to Kitimat Yard, and 3,000 cubic metres of winter abrasive at Hays Pit to be hauled to Salvus Camp Yard. Inland Contracting Ltd. sub- mitted the lowest of ‘three tenders. - Tender won TERRACE — Vic Froese Trucking has won the contract for soil screening for a variety of city projects. Froese’s bid of ‘$22,080 was far below the com- petition of Kitimat Landscaping at $31,800 and Far-Ko Contrac- ting at $46,800. The contract involves screen- ing approximately 12,000 cubic meters of city-owned soil and separating any debris. The soil will then be used on projects such as the Arena hill. GROCERY Laundromat & Carwash | Open 8:30 - 10:30 daily 2701S. Kalum 635-6180 4 , fy | . Be nai | (This spot could ‘ vie Semany wel | 2° be yours for only *1,000,000 liability for YOUR protection Terrace, B.C. 635-7400 " (604)638-1437 * Face Frama & Europa Styla Cabinets * «Cedar Wiridows and Dads .» Commercial & Residential Cabinetry’ Sales and Service for . _— Motorcycles * Chainsaws 3 ~*~. Snowmobiles * Marine Supplies TERRACE A EQUIPMENT SALES LTD. | 4441 Lakelse Ave., Terrace — Ph. 696-6384