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One of the most common ways for a firm to fail financially is poor control over cash flow. This statement is a true statement.
What does having a positive cash flow mean?
The net movement of cash into and out of a business at a particular point in time is referred to as cash flow. A business's flow of cash is continuous. For instance, when a retailer makes an inventory buy, cash leaves the company and goes to the suppliers.
What is the primary objective of cash flow?
A cash flow statement's goal is to give a thorough account of what occurred to a company's cash over the course of an accounting period, which is a set time frame. Based on how much money is coming into and going out of the company, it illustrates an organization's capacity to run both short- and long-term.
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