- Cash flow is about the cash inflows and cash outflows
- Cash inflows (incoming money - so sales revenue)
- Cash outflows: money business uses to run the business
Financial Health of business -
- measured with cash flow forecasting and cash flow statements
- helps managers make sure there is enough money to pay for the business operations
Profit vs Cash Flow
Cash flow ⇒ how much money comes in and goes out. Is there enough money coming in to pay for things
Profit: retained earnings after paying for business expenditures