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Positive & Negative Cash Flow

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1. What is cash? Think in terms beyond its monetary function.

2. When might a negative cash flow be considered positive? Provide an example and explain.

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1. What is cash? Think in terms beyond its monetary function.

Cash (also known as "readies") is an asset ... one of three "current assets" along with stocks and debtors. It is money that is readily available, or liquid. The other "current assets" are not as liquid as cash, due to the time it takes to convert them into cash. Most businesses do not keep a large amount of cash on hand due to the fact that money accounts rarely earn interest. Retail businesses tend to keep a lot of cash on hand due to the ...

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