Chapter 21. Financial Planning
In This Chapter
• How to create a proforma
• How to create an income statement
• How to create a cash flow statement
• How to create a balance sheet
If you’re going to make the transition from a part-time business to one that will become a primary source of income, you need to have a good idea of what money you’ll need, where it goes, and how it’s spent. You need a clear picture of your financial position at any one point in time.
To do that, you need a proforma (a projection of your revenue and expenses) and what’s called in the accounting trade the Big 3 financial statements (income, cash flow, and balance sheets). The financial planning you do for your business is just as important as your business plan. If ...
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