What is a cash flow forecast and how is it used?

What is a cash flow forecast and how is it used?

• A. A plan for expanding product lines; used for marketing.
• B. A projection of expected cash inflows and outflows; used to plan funding needs and avoid shortfalls.
• C. A statement of assets and liabilities; used to assess solvency.
• D. A record of past profits; used for tax filing.

Answer: (B)