Developing A Cash Flow Plan

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Executive Summary

A cash flow plan is a recorded projection of the amount and timing of all cash inflows and cash outflows expected to occur throughout the planning period. Larger farms, substitution of capital assets for labor, and inflation increase the amount of cash required to operate the farm or ranch and make the cash flow plan an increasingly valuable tool in farm financial management. The cash flow plan establishes target levels for income and expenses, which can be used in monitoring progress towards goals.

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