How & Why to Create a Daily Cash Report

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small business finance, small business daily cash flow report

New business owners often confuse their earnings and cash flow, which is why a daily cash report is ideal for helping them make better financial decisions for their business. One of the hardest things for new business owners to understand is that their earnings and cash flow aren’t the same thing.

A daily cash report shows you how much cash you have on hand and helps you make better financial decisions regarding your business.

Do these three steps daily:

  1. Choose a date range. You can plan as far in advance as you want, but your projections will be less accurate the further ahead you plan.
  2. List all the income you have coming in over the coming days and weeks. Add tax refunds, grants, and investments to the correct week or month.
  3. List your cash outflows, including payroll, rent, tax bills, loan payments, materials, and payroll taxes. Add up your total and subtract your outgoing cash from your incoming cash.

If you don’t have enough cash on hand to pay your bills, you may need to take out a loan or line of credit or reduce the number of employees you have on staff.

When you consistently create a daily cash report, you’ll start to notice trends in your business over time.

If your company consistently generates positive cash flow, you’re in a good financial position. Understanding your daily cash flow allows you to make better decisions about your business.

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