In this workout an analyst has started building a quarterly forecast model as shown here and we're asked to use the quarterly cash flow information to build annual cash flow forecasts and to complete the model build. Let's start off with building out annual cash flow forecasts. Now because a cash flow statement represents a period of time and your cash flow forecasts are simply the sum of our four quarterly cash flows. So let's build that calculation now.

Now my ending cash balance net of revolver. The bottom line cash flow statement is a balance sheet item. So for this item, I simply need to link my annual forecast to my Q4 forecast. I can now take this balance and use it to populate my cash and My Revolver balance in my balance sheet.

I'm going to use the max function here to ensure that if the cache net of revolver is a positive number this goes into my cash and cash equivalents.

My fy1 cash balance. I'm going to link that to my q4mbalance for consistency with the rest of my balance sheet.

For the revolver. I'm going to use the Min function so that if the balance of the bottom of my balance sheet is negative. This is taken to the revolver line.

And again, my fy1 number is just going to be linked to my q4n number.

We've now completed the balance sheet. The final step is to build our interest calculations.

The main thing we need to remember when we're building. Our interest calculations is that we're building them on a quarterly basis. So we'll divide our calculation by 4.

I can now sum the quarterly interest calculations to give annual interest.

The final step is just to pop interest into your income statement using circular switch. I'll leave you to do this on your own and you can check your answer against the solution file.