Cash Flow Basics

How is it possible for a profitable company to not to have enough cash to operate? If you remove theft or other disasters from the equation, the most likely answer is: The business owner did not understand cash flow.

In this video, Ken Boyd explains what cash flow means, how you manage it, the terms and ratios that successful investors use to measure it, and why it's just as important as profit in gauging a company's value. Along the way, you'll learn about statements of cash flow, aging of receivables, collections policies, methods of costing, turnover ratios, and capitalization.

• Gain an understanding of how to manage cash flow and why it's critical to business survival
• Explore the fundamental reasons why cash flow drives company value
• Learn about the statement of cash flow and how it relates to other financial statements
• See the interconnection between cash flow, accounts receivables, and inventory management
• Discover how cash flow and inventory management affect your ability to meet customer demand
• See how cash flow and effective accounts receivables policies keep businesses alive
• Understand the investor ratios that good business people use to monitor their cash

Ken Boyd has over 30 years of experience helping companies create budgets, make decisions about long-term financing, and evaluate how to raise capital. Ken is a former Adjunct Professor at St. Louis University who creates books, podcasts, blogs, articles, and lectures on accounting and finance. He is author of the O'Reilly title Understanding an Income Statement as well as Cost Accounting for Dummies, The CPA Exam for Dummies, and 1,001 Accounting Questions for Dummies.