BUISENESS MANAGEMENT
RECORD KEEPING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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If you have a negative cash flow
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You may not be able to pay your bills
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You may have to borrow money
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Your disbursements are greater than your receipts
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All of these
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Explanation:
Detailed explanation-1: -Negative cash flow is when your business has more outgoing than incoming money. You cannot cover your expenses from sales alone. Instead, you need money from investments and financing to make up the difference.
Detailed explanation-2: -An increase in any liability will be a positive amount on the statement of cash flows (SCF). A decrease in any liability will be shown as a negative amount on the SCF. [Because Accounts Payable is a current liability, the change will be shown in the operating activities section of the SCF.]
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