A company that is profitable may not have sufficient cash on hand to meet their immediate needs.

Name: A company that is profitable may not have sufficient cash on hand to meet their immediate needs.
Brand: Quizplus
Rating: 4.9 (36 reviews)

Question

Quizplus · Accepted Answer

Profit is the excess of revenue over expenses, but cash on hand refers to the actual amount of money available. A company may be profitable and have money owed to them, but if their customers haven't paid yet, they may not have cash on hand to meet immediate needs such as paying employees or suppliers.

A Company That Is Profitable May Not Have Sufficient Cash