Cash Management Assumptions

The cash management assumptions section allows you to adjust the time periods for accounts payable as well as for account receivable for each revenue model separately.

Accounts Receivable Assumptions

For each source of revenue, enter the number of months, on average, between the sale of a product or service and cash receipt for that sale:

Zero = You immediately collect payment (via credit card)

1 = Customers take about 30 days to pay you

2 = Customers take about 60 days to pay you

3 = Customers take about 90 days to pay you

Accounts Payable Assumptions

Next enter the number of months it takes, on average, it takes for you to pay for products or services used to operate the business:

Zero = You immediately pay your bills

1 = You take about 30 days to pay your bills

2 = You take about 60 days to pay your bills

3 = You take about 60 days to pay your bills

Note: If you aren't sure what your accounts payable receivable should be, consider setting each assumption to zero. After entering other revenue and cost assumptions, return to this section and make adjustments as needed. As you increase or decrease your accounts payable and receivable, note the impact on cash flow and financing needs.

__________

Continue to the One-Time and Annual Cost Assumptions or, if you don't have any one-time or annual costs, start entering your Operating Expenses (OpEx) Assumptions. Or, head back to the Guidance page.