Cash flow represents the money coming in and going out of your business. Managing cash flow is one of the most important aspects of business. In the planning phase, your cash flow estimates can help you decide whether your business idea is viable. The Cash flow assumptions page lets you set and update a few basic assumptions about when you pay and get paid. You'll see the results of these settings in your Cash Flow table.
For a helpful primer on this subject, read Cash Flow 101: What is Cash Flow?
Accounts receivable and Accounts payable
Accounts receivable is also sometimes known as incoming payments or A/R. When you make sales to your customers on credit, you'll need to set up Accounts receivable in your forecast. Accounts payable, on the other hand, is sometimes also referred to as outgoing payments or A/P. When you make purchases from your suppliers to run your business, if you pay for any of them on credit, you'll need to set up Accounts payable in your forecast.
For details on how to manage these settings, read Adding Accounts receivable and Accounts payable to your forecast.
If your business will manage inventory, turning on this setting will automatically build inventory usage and reorders into your cash flow. For details on how to add inventory to your forecast, read Managing Inventory.
Where does this entry appear in the financial statements?
The Cash Flow Assumptions don't appear in the Profit and Loss table explicitly, except to possibly move some revenues and some expenses to future months.
In the Balance Sheet, your Accounts Receivable and Accounts Payable will appear as shown below:
In the Cash Flow, accounts receivable and payable will appear as "Changes," meaning the amount of increase or decrease in accounts receivable or payable each period. If you see a zero listed here, it doesn't mean there were no receivable or payables; it means there was no change in them: