Cash Flow

Cash flow, meaning the inflow and outflow of money, is usually used in the context of a business. Both the amount spent and the amount received as revenue constitute the cash flow. As per Harvard Business School Online’s Business Insights, the cash flow definition is, ‘the net balance of cash moving into and out of a business at a specific point in time.’

While there are many types of cash flow, such as financing or operating cash flow, remember that cash flow can be positive or negative. As you can tell, a positive cash flow is better as it means a business is enjoying good liquidity and is operating optimally.

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