Cash-Flow
Movement of money in/out of business.
Formula
Net Cash Flow = Cash Inflows − Cash Outflows
Real World
In 2020, many hospitality businesses like Wagamama had strong profit on paper but suffered severe negative cash flow because restaurants were closed and no revenue was coming in.
Exam Focus
Never confuse cash flow with profit — a business can be profitable but still fail due to poor cash flow; examiners reward this distinction.
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