100% satisfaction guarantee Immediately available after payment Both online and in PDF No strings attached
logo-home
Previously searched by you
Previously searched by you
logo
UNIT 5 M1&D1 - analyse the cash flow problems a business might experience & justify actions a business might take when experiencing cash flow problems £3.99   Add to cart
Quickly navigate to
Preview
  2.  
  3. Undefined
  4.  
  5. Level 3 BTEC Business Extended Diploma
  6.  
  7. UNIT 5 M1

Answers

UNIT 5 M1&D1 - analyse the cash flow problems a business might experience & justify actions a business might take when experiencing cash flow problems

5 reviews
 3865 views  7 purchases

For M1, learners should comment on the cash flow, highlighting any problems that are evident, such as a shortage of cash as a result of costly capital expenditure in one month. For D1, learners will make appropriate recommendations to solve the cash flow problems, such as retiming large payments or...

[Show more]

Preview 1 out of 4  pages

Document information

  • February 9, 2016
  • 4
  • 2014/2015
  • Answers
  • Unknown

Subjects

  • btec
  • business
  • level 3
  • extended diploma
  • analyse the cash flow problems a business might experience
  • justify actions a business might take when experiencing cash flow problems
  • m1
  • d1

Written for

All documents for this subject (1)

5  reviews

review-writer-avatar

By: amhaigh • 6 year ago

review-writer-avatar

By: ifti72 • 7 year ago

review-writer-avatar

By: andreasandriano98 • 7 year ago

review-writer-avatar

By: hanely509 • 7 year ago

review-writer-avatar

By: free2rabani • 8 year ago

Seller

avatar-seller
thebestanswers

Reviews received

Content preview

Unit 5 - M1 & D1

FOR NOTES AND GUIDLINE PURPOSES ONLY, COPYING THE
WHOLE DOCUMENT WILL BE COPYWRITE.

USE SENSIBLE.




Problems of Peter Watson’s cashflow

For Peter Watson firstly, in some of the months the sales balance is higher and in
some it is low probably due to seasonal fluctuations or slow sales at the start of his
business for instance Sales figures for March and July which is £15,750.00 and for
August which is £10,710.00 are low whereas for October (£22,050.00), November
(£25,200.00) and December (£30,000.00) the sales figures are high. This will result
in the business having reduced income. However having unstable and fluctuating
sales figures for Peter Watson resulted in the business having negative closing
balance therefore an overdraft occurred starting from July.

The business also had no enough income which resulted in Peter Watson borrowing
money from the bank in March. This made Peter Watson having to increase the
payments. Also this will gave an end result whereby his business having to pay
interest on loan of £12.50 and repaying capital of £25.00 from April till December
which increased the expenses. The cause of the business borrowing capital from the
banks was probably due to poor business model or ineffective management. Also not
having capital, will result in the business not being able perform business activities.

Another problem that Peter Watson faced is overtrading whereby he wanted his
business to expand quick, putting pressure on short-term finance for instance he
purchased a new motor vehicle in March for £4,500.00. This caused the business to



1

The benefits of buying summaries with Stuvia:

Guaranteed quality through customer reviews

Guaranteed quality through customer reviews

Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.

Quick and easy check-out

Quick and easy check-out

You can quickly pay through credit card for the summaries. There is no membership needed.

Focus on what matters

Focus on what matters

Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!

Frequently asked questions

What do I get when I buy this document?

You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.

Satisfaction guarantee: how does it work?

Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.

Who am I buying these notes from?

Stuvia is a marketplace, so you are not buying this document from us, but from seller thebestanswers. Stuvia facilitates payment to the seller.

Will I be stuck with a subscription?

No, you only buy these notes for £3.99. You're not tied to anything after your purchase.

Can Stuvia be trusted?

4.6 stars on Google & Trustpilot (+1000 reviews)

70055 documents were sold in the last 30 days

Founded in 2010, the go-to place to buy revision notes and other study material for 14 years now

Start selling
£3.99  7x  sold
  • (5)
  Add to cart