It is important for Heather to monitor her cash flow because:
A)if she borrowed money to finance her business,the lenders will want to make sure she used the money wisely.
B)her investors will want to make sure they get their money back.
C)cash flow is a measure of her success.
D)a business can go bankrupt with negative cash flows even though the income statement shows a profit.

Question

Quizplus · Accepted Answer

Cash flow is a vital measure of a business's financial health. A company can show profits on their income statement, but if they have negative cash flows, they can go bankrupt. Therefore, it is essential for Heather to monitor her cash flow to ensure that her business does not go bankrupt.

It Is Important for Heather to Monitor Her Cash Flow