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GCSE Business · key term
The cash balance at the start of a period, equal to the previous period's closing balance.
Used by AQA, Edexcel and OCR
Paper 1, Paper 2
The cash position of a business at the beginning of a period.
Revise: Cash Flow ForecastingManagers then total each month’s inflows and outflows, calculate the change in cash and work out the closing balance. That closing balance becomes the next month’s opening balance.
Carry each closing balance forward as the next month’s opening balance, including any minus sign. Brackets around a figure can indicate a negative value.
In a cash flow forecast, include loans received as inflows and loan repayments as outflows. Carry each closing balance forward as the next opening balance.
Work through forecast months in order. One month’s closing balance becomes the next month’s opening balance, so an error can carry forward.
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Specification 1.3.3 · Paper 1
Revise: Cash and Cash-FlowThe opening balance is the cash available at the start of the period.
Paper 2
The cash balance at the beginning of a time period, carried forward from the previous period’s closing balance.
Revise: Completing Cash Flow ForecastsThe opening balance is the cash available at the beginning of the period. The first opening balance must be given or established from earlier information. Here, July begins with £1,760.