Using Figurewizard - How to Forecast Cash Collection

Calculating cash collection from accounts receivable.

How Cash Receipts from Clients are Calculated

The following example explains how the values of cash receipts from accounts receivable (i.e. goods supplied on open credit) are entered. Cash is calculated by our system from the percentages you entered as follows:

If on average you expect to receive 5% of the value of accounts receivable in the same month that your invoices / bills are issued, 5% should be entered for month 1.

If on average you expect to receive 50% of its value one month after your invoices / bills are issued, 50% should be entered for month 2.
And so on - As an example of how it this is entered, assume a year in which £100,000 had been billed / invoiced:
month ref. average % cash received i.e. Cash collected
month 1 5% £5,000
month 2 50% £50,000
month 3 30% £30,000
month 4 10% £10,000
month 5 5% £5,000
totals 100% £100,000

Charge Card Receipts

The cash collection table is used to calculate monthly receipts only in respect of clients who have been supplied on open credit.  Receipts arising from debit / credit card transactions are calculated separately from the information you enter on the form with no further intervention required from you.

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