BUISENESS MANAGEMENT
BUSINESS PLANNING
Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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positive
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negative
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Either A or B
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None of the above
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Detailed explanation-1: -If a business’s cash acquired exceeds its cash spent, it has a positive cash flow. In other words, positive cash flow means more cash is coming in than going out, which is essential for a business to sustain long-term growth.
Detailed explanation-2: -Key Takeaways: It is possible for a company to have positive cash flow while reporting negative net income. If net income is positive, the company is liquid and profitable. If a company has positive cash flow, it means the company’s liquid assets are increasing.
Detailed explanation-3: -It’s entirely possible and not uncommon for a growing company to have a negative cash flow from investing activities. For example, if a growing company decides to invest in long-term fixed assets, it will appear as a decrease in cash within that company’s cash flow from investing activities.