Cash flow
Cash flow problems can lead to a business's closure
Cash is generated by a business through the sale of goods or provision of a service. It is important that businesses have enough cash to:
- pay employees
- buy supplies
- cover business expenses
Cash flow is all the money that comes into and goes out of a business.
There must be more cash coming into the business than there is going out to avoid the company going into When a business ceases trading due to not being able to pay its debts. The business assets are sold to pay for the outstanding debts of the business.. This would mean they are no longer able to trade.