Question

The difference between cash flow statement and cash budget is/are __________________.

• A. Cash flow statement shows the movement of cash whereas cash budget portrays no cash movement.
• B. Cash flow statement is a part of cash budget
• C. Cash budget shows the cash movement of the future period in contrast to cash flow statement where it displays the cash movement of the past period.
• D. All of the above
• E. Both (B) and (C) above

Answer 1

The correct option is C Cash budget shows the cash movement of the future period in contrast to cash flow statement where it displays the cash movement of the past period.

Cash flow statements analyzes cash transactions which have already occured whereas cash budget shows the cash movement of the future period.